We're probably out of compliance but who's counting? (software copyright regulations)

It is so tempting to make just a few more copies of that program. After all, we only use our one licensed copy for a few hours a week, so why pay for another when on rare occasion we need two people to work with it at the same time? And doesn't the license agreement let us make and use an extra copy under some conditions anyway? We aren't really cheating, are we? It's not as if it were a federal offense.

In 1980, the Copyright Act, title 17 of the U.S. Code, was amended in order to explicitly include computer programs. Unless the copyright owner grants specific authorization, no copies of software may be made with the exception of a single copy for backup/archival purposes and a copy as an "essential step" in using the program.

This latter user right provides for the copying of the program into RAM, which is a process whereby a copy is made from one media (hard disk, etc.) into the computer's memory where instructions may be performed. Title 18 of the U.S. Code prohibits duplicating software for profit. This means that downloading multiple copies of software from a network or providing multiple copies to different users in an organization, even if only one copy may be used at a time, could violate federal law unless proper authorization has been obtained.

Under Title 18, Section 2320 and 2322, penalties may include jail terms up to five years and fines as high as $250,000. In addition, the U.S. Congress approved the Software Rental Amendments Act in December of 1990 which addresses the rental, leasing, or lending of software. In general, such actions are prohibited without the written permission of the copyright owner.

Unless a user or manager has a clear understanding of the license agreements for the software they are using or responsible for, the conservative approach to determining potential license rights and violation liabilities should be to assume that any copies other than one backup for archival purposes and one required for actual use are prohibited by U.S. law. Any other copying rights must be specifically granted by the copyright holder. With this background, let us look more closely at Microsoft's licensing policies as an example of the way one software company provides copy, usage, and transfer rights to its customer base.

Any time you purchase a legal Microsoft software product, it should be accompanied by an end-user license agreement (EULA). Generally, the EULA may be found on-line within the software, printed in the User's Manual, or as a separate document packaged with the product. This is where the user is provided with any rights in addition to those described above (two copies: one for backup/archive, one for use).

The EULA also addresses issues such as restrictions on reverse engineering, leasing, and renting the software product. The "Grant of License" section describes how the software may be used. A software product is considered to be in "use" when it is installed on a mass storage device such as hard disk or CD ROM, or when it is loaded into "temporary memory," or "RAM."