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WW005. On-line Software Distribution Agreement (Drafted for the Software Owner’s Benefit)


This On-line Software Distribution Agreement is designed for a Software Owner to grant to an independent Distributor the right to distribute software over the Internet.

In this particular Contract the Distributor wishes to mass market lower value software (i.e. “off-the-shelf” type software which would, if conventionally distributed, be covered by a “shrink-wrap” software license).

As this software is in digital format, it is transferred over the Internet to the final end-user without the need or the expense of manufacturing CD’s, floppy disks or distributing them via a retailer to the customer. The Distributor will also be able to provide software support, updates, upgrades and help-line facilities more efficiently on-line. This can allow more accurate target marketing as well as saving costs. When such an agreement is drafted for a Software Owner there are numerous important aspects to be considered, including the following:
  • Should the Distributor be granted an exclusive or non-exclusive right? This Contract is drafted more in favour of the Software Owner, where a non-exclusive grant allows the Software Owner to appoint other distributors to widen the marketing for the Software.
  • Does the Software Owner wish to give the Distributor the right to market and support the software? If the Distributor is given the right to support the Software, then it must be given a significant amount of proprietary and confidential information. In addition, if the Distributor is to support the Software, the Software Owner is removing itself further from the direct line of contact with its end-users, and therefore more removed from the “feed-back” of information which may be essential for “bug” fixing, upgrading, development and product enhancement. Since the Software is to be distributed on-line, it is far easier for the Software Owner to set-up an on-line support site to monitor and manage fault calls PROVIDED it has the resources to administer such customer support.
This Contract has included support by the Distributor and guidelines for amendment when the Software Owner supports the Software.
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