The outsourcing of software development to overseas as well as onshore dedicated development centers gained wide acceptance as an integer part of the business model of many companies. Outsourcing software development generates time and money efficiencies, but still it has its own concerns.

Undoubtedly, the most widely used development model includes the utilization of pre-built software modules as well as external components. Its a work under constant pressure to yield a quality software product within the shortest time possible. At once software engineers must not trade quality for speed. Ultimately, it is the most sound solution to use third-party components which ensure several benefits, in terms of more rapid development as well as in terms of proven quality, however, herewith arise some licensing issues that need to be overlooked. Unrestricted usage of third-party components without appropriate licensing or fees can cause the complete failure of the project.

Familiarize with the business terms of open source products

Typically the open source components are used in software development to meet stringent delivery terms while producing quality code. However, keep in mind that "Open source" does not stand for free use – it means that the code is published – which isn't the same as free to use.

When opting for outsourcing software development, don't count for 100 per cent originality of the code. Upon delivery of the code by outsourced entities, you don't get the guarantee that the code has been developed by the outsource entity. The open source code originates in different place than the outsourcer, thus generating an intellectual property rights issue. However such practice is not applicable to everybody but some service providers dedicated to coding may grab lines of open source code and integrate it into their own.

Avoid of permutations of open source code

There may exist such situations when a developer, under time pressure but not wishing to involve in license violations, can take a part of open source code and make minor modifications to it to make it kind a n authentic. Such minor modifications to the code don't relieve developers from duty to comply with license requirements of the original code. Compliance is required in any case, even if small pieces of code were taken and modified – there even exists a special software to detect the stolen open source code.

Ascertain that outsourced code passed vetting for open source components

In theory it is almost impossible to monitor code manually to detect open source. For that purpose there are special software suits that automatically analyze code and mark any open source code detected. The authors of the idea intend to create a kind of open source code repository acting as a directory service to determine whether any open source code has been used in an outsourced code development project.

The scope of developers' goals includes: deliver quality, tested code in the tightest time frame, and at that be sure that deliverable is compliant with all existing intellectual property restrictions on any components used on the project. Companies using external software developers more than rest aware of the intellectual property risks. Software development providers must be proactive themselves to demonstrate the compliance of their code and the above repositories will be used for verification.

Keep to the best practices in management of software compliance

Irrespective of whether a company develops internally or outsources, appears the necessity to ensure that software doesn't infringe on any patents, copyrights, trade secrets and licensing restrictions.

There are several steps to ensure proper software compliance:

• Review code to verify the existence of any open source or third party components.
• Understand and comply with license requirements of third-party or open source code used in the course of development.
• Re-use the software legitimately to maximize productivity.
• Lessen risks and exposure to legal action through complying with all IP licensing restrictions.
A company needs to stay on top of its obligations, but to do that it needs to get the thorough understanding of intellectual property issues as well as keep careful track of use of third-party or open source code in software development projects.