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What is the Difference Between Traditional Escrow and SaaS Escrow?

Typically, companies and organisations have protected themselves against the risk of a software provider going into administration with a source code escrow agreement. This is where the software source code is held in trust by an escrow agent. Then, if anything should happen to prevent the software company trading or maintaining the software, the escrow agent releases the source code to the end-user. This gives the end-user the necessary information to maintain business as usual operations, even if the software vendor is no longer trading.

But, when it comes to cloud-based products, traditional escrow is not effective. In fact, even with traditional escrow in place, end-users are still vulnerable. What they need is an escrow agreement that protects against risks that are specific to using cloud-based software.

What is the risk of using the cloud?

More companies than ever before are implementing, or looking to implement, cloud-based software. While there are many clear benefits of using the cloud, there are also some  risks that don’t exist with installed software. Ignoring these risks and not introducing suitable protection is leaving them exposed to potential loss of business, reputation damage and a high cost to rectify the problem.

The risk for companies using cloud-based software is that their software and data is all held off premise by either the software vendor and or by a hosting company.. As well as dealing with the software vendor, the end-user must also deal with the additional risks of their hosting company.

With traditional installed software, when a software company ceases trading and goes into administration, it leads to a real headache for the people using the software. They are left in a situation where they may be unable to maintain business critical software, causing real difficulties, but at least they still have access to their software and their data. They still have an element of control. But, with cloud-based software, they are not just exposed if the software provider goes into administration; they are also exposed if the hosting company goes into administration. Their exposure is also immediate, as there is no on-site installation. If the administrator switches the lights off – your business critical software goes off with it!

How can companies protect themselves against the risk?

Companies do not need to leave themselves exposed. Instead, they can protect themselves from the risk with an escrow agreement specifically tailored for SaaS products.

To combat the risk of using a SaaS product, Access Assure is now available. It is a proactive SaaS escrow solution, which protects organisations against loss of service, if either their software provider or hosting company goes into administration. Access Assure has been specifically designed to ensure that software users have contractual recourse prior to software vendors and hosting companies going out of business. Access Assure will ensure continuity of service for software users at a cost that reflects the commercial benefits of the Cloud. Access Assure will ensure that you stay in control and you don’t put your business at risk.

If you would like to find out more about SaaS escrow and how it protects against loss of service from cloud-based products, please contact us.

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