ASP Agreement Components & Inclusions
For Application Service Providers – anyone who provides clients access to
licensed software and application services – implementing a system of checks
and balances, risk management procedures and quality control is invaluable. Typically
a solid Application
Service Provider (ASP) Agreement will fulfill these needs.
An Application Service Provider Agreement manages the relationship between an ASP
and the licensed user. In other words, it sets limits and expectations on the use
of your software and applications server. It also controls who has access to the
software or servers as well as where and when they can be accessed.
An ASP Agreement
will also prevent modification or reverse engineering of the software and determine
server storage space available for each client, which limits exposure to infringement
on intellectual property rights and confidentiality. Most importantly, these agreements
reduce the ASP’s liability for deficiencies and defects in the software or
on the server.
ASP Agreements are not only necessary for large-volume ASPs; they also cover service
providers who offer single applications to their clients. ASP businesses that would
benefit from the agreements include:
- Specialist or functional ASP – provides a single application,
such as credit card payment processing or timesheet services
- Vertical market ASP – provides a solution package for a specific
customer, such as a doctor’s office
- Enterprise ASP – offers a wide variety of
solutions
- Local ASP – offers small-business services in a particular
area
- Volume ASP – delivers cost effective package solutions through
its own Web site
An important component of an ASP is the Service Level Agreement (SLA). This formally
negotiated agreement between two parties is part of the service contract in which
the level of service is formally defined. This agreement might include delivery
time of the service or performance. It clearly defines and documents the common
understanding of services, responsibilities and guarantees, while typically covering
issues such as serviceability, performance and operation, just to name a few.
Service providers can purchase
packages that include a variety of templates, including a software license
template. Software license Agreements
set the terms and conditions for the end users of your software and includes disclaimers,
limitations of liability, and confidentiality agreements, among other safeguards.
When searching for packages, most companies will provide
ASP Agreement samples for viewing. Be sure the software license template
and the ASP Agreement sample includes the following sections:
- Grant of License
- Use and Access
- Price and Payment
- Technical Support
- Terms and Termination
- Ownership of Intellectual Property
- Confidentiality
- Warranty and Disclaimer
- Limitation of Liability, Indemnification
- Relations of Parties
- Non-assignment
- Arbitration
- Attorney’s Fees
- Severability
- Force Majeure
- Waiver and Modification
- Entire Agreement
ASP agreements will safeguard your company from any future claims of damages, and
reduce your exposure and liabilities. Many companies have made it easy to implement
the agreements by providing packages specifically designed for the service providers
needs. Be sure to preview the ASP Agreement samples to ensure it covers the needs
of your business.
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