Many companies are looking to move the software they use for businesses from a licensed software situation to a cloud-based one. However, a company may decide that while it isn’t ready to move into the cloud yet, it may wish to do so in the future.

This is where the current licensed software provider can be very useful. After all, they have the knowledge around the software where businesses generally don’t.

So when signing an agreement with a licensed software provider, include a desire to move to the cloud in the agreement. Clauses can be negotiated which will make moving to the cloud much easier.

For instance, a clause requiring the licensed service provider to regularly assess the merits of moving to the cloud. This could be their own cloud-based version of the software or another provider’s cloud-based software.

The provider should assess what services are available, what price they are, and what features cloud-based software has versus the current licensed software. This clause could include the requirement to make these assessments and provide a report to the business periodically – typically every six months to a year.

Another clause that it is important to establish is one regarding ongoing use of services in the case that the business wishes to transition to cloud-based software. Often software licenses are provided on an annual basis, so what provisions are there for transitioning to the cloud midway through this period? This may involve paying monthly or receiving a pro-rated refund after moving halfway through the term of the agreement. There should also be provisions for the software provider to assist with the transition to the cloud, to ensure the process goes smoothly.

Where the software is hosted on a managed server – meaning various parts of a businesses IT functions are outsourced – it could be beneficial to move part or all of the managed service to the cloud. This may be at the discretion of the service provider. In an agreement for this kind of service, it’s important that there are provisions for the service provider to let the business know that they are moving to the cloud, as there are some issues that the business may need to address. How will the service be provided after the shift? And if there is money saved by the move, will those savings be passed on to the service user?

IT Contract Templates provides support for businesses who are considering moving to the cloud, whether they are ready to make the move or whether they are staying with their licensed software provider for the short term.