Software Distribution Agreements

Distribution agreements are widespread in the business world, as they allow third parties, so-called distributors or licensees, to sell a developer`s product to consumers. Software distribution agreements expressly allow distributors to market and sell the developer`s software to end users. A software distribution agreement defines the rights and obligations of the developer and distributor in order to avoid any subsequent disputes. VII. ROYALTIESThere are several alternatives available to a software licensor for pricing its software in a distribution program. The choice of any of the options listed below may depend on the negotiating strength of the parties, the development costs associated with the software, the number of competitors in the market or the expectations of the end customers. In addition to making alternative royalty agreements available, the following section examines legal considerations for pricing, particularly in light of the requirements of antitrust law.A. Alternatives Any software distribution agreement is different and, although there is no one-size-fits-all solution, many agreements have common terms. The developer usually decides whether the distributor has an exclusive software distribution agreement that would prevent other distributors from selling the software in the same region or a non-exclusive agreement that would allow other distributors to sell in the same market.

Another way for a distributor to prevent the developer from selling the product is to present their commercial marketing plan and explain who they are using as a software reseller. If for any reason the software cannot be returned to the owner, it will be destroyed within 10 days of termination. . . .

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