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Looking for Sanity in SaaS Contracts – an Epilogue

I had just finished up my series entitled Looking for Sanity for Saas Contracts (parts 1, 2, 3, 4, and 5) when I received an issue of PLC Intellectual Property & Technology from Practical Law Company in the mail. Guess what’s on page 34? An detailed checklist for SaaS agreements that shows what the Client/Customer position should be and what the Vendor/Provider position should be. It’s a 5 page checklist.

The authors write:

SaaS offers many potential benefits, including, reduced cost and efficient delivery of software applications. However, before entering into a SaaS agreement, customers must understand how SaaS services are provided and the associated technical and legal issues.

So far so good, though I have my doubts that many lawyers will really understand the technical issues. That’s what your IT staff is for if they aren’t already involved in the negotiations.

They continue:

The following chart identifies key issues typically featured in a SaaS agreement and positions that both a customer and provider may consider for each issue. While the chart highlights certain important considerations for a typical SaaS arrangement, each agreement must be tailored to reflect the partis’ particular needs and interests.

I call B.S. on this. This is basically saying that a “fair” contract is one that will meet in the middle of these sets of positions. Baloney. This is the sort of drivel that leads to unnecessarily protracted contract negotiations because overly cautious lawyers are heeding the advice of so-called experts.

Unlike Mr. Classen’s article, I’m going to address this checklist point by point in a series of posts to come next month. Stay tuned.

Author’s note: I actually do like PLC as a service, so I am not denigrating that. Just the perspective of the authors of this checklist, of whom I note that only one has any real tech experience in addition to 1 year of his practicing law.

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A bit about me

Thomas Chow is a seasoned executive with 20 years of experience in technology, legal services, and startup companies. A former China law and business blogger, he is currently General Counsel & Secretary at PubMatic, a digital advertising platform providing automation technology for publishers and programmatic tools for media buyers.  He still enjoys a good chat about all things Chinese.

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