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Negotiating Software Contracts – Successfully Negotiating a Warranty Section

The Licensing Journal August 2016

A warranty is one of the most important contract provisions in a software contract. The warranty section deals with the performance of the software and what the licensor promises the software will or will not do. In a software contract, these performance warranties should be heavily negotiated, but usually they are overlooked. Because so many factors can affect the performance of the software, publishers seek to limit their warranty, and provide limited remedies in the event of a breach. It’s important for businesses who license software to have a strategy in place to successfully negotiate this section. But, what exactly are the pitfalls when negotiating a warranty provision, and how do you successfully navigate it?