Software Beta Testing

SOFTWARE BETA TESTING

NINE KEY CONSIDERATIONS

Prepared By: Ony Okoro

A beta test is the final stage of testing a software prototype before it is ready for launch.

WHAT IS A BETA TEST?

CONSIDERATION #1:WHAT ARE THE RISKS TO CONDUCTING A BETA TEST?

Disclosure of your trade secrets.

Third party rights to your prototype.

Damage to a third party as a result of the beta test.

MANAGE YOUR COMPANY’S RISK AND PROTECT YOUR COMPANY’S INTELLECTUAL

CONSIDERATION #2: WHO OWNS YOUR PROTOTYPE?

Will evaluators have rights to improvements?

Who will own the data resulting from the evaluation?

How can you prevent evaluators from reverse engineering or modifying your prototype?

PROTECT YOUR COMPANY’S INTELLECTUAL PROPERTY CONTRACTUALLY

CONSIDERATION #3:WHAT IS THE SCOPE OF THE EVALUATION?

What constitutes proper use of the prototype?

Will the evaluator have rights to use the prototype for commercial purposes?

LIMITING THE SCOPE OF THE EVALUATION MAY OFFER GREATER PROTECTION FOR YOUR COMPANY

CONSIDERATION #4:WHO SHOULD EVALUATE YOUR PROTOTYPE?

What role should evaluators have in the market?◦ Direct Customers◦ Indirect Customers ◦ Competitors◦ Academics

EVALUATORS SHOULD BE DIVERSE CONSIDER AVOIDING COMPETITORS

CONSIDERATION #5:WHAT CONFIDENTIALITY OBLIGATIONS SHOULD EVALUATORS HAVE?

How long will confidentiality obligations last?

Under what circumstances will confidentiality obligations no longer apply?

How limited should access to the prototype be?

STRONG CONFIDENTIALITY AGREEMENTS OFFER GREATER PROTECTION FOR YOUR COMPANY’S TRADE SECRETS

CONSIDERATION #6:WHO SHOULD HAVE ACCESS TO THE PROTOTYPE?

Will the evaluation take place at a single site or at multiple sites?

Will affiliates of the evaluator have access to the prototype?

Will consultants/contractors/agents have access to the prototype?

LIMITED ACCESS TO THE PROTOTYPE OFFERS GREATER PROTECTION FOR YOUR COMPANY’S

TRADE SECRETS

CONSIDERATION #7:WHAT CAN EVALUATORS SAY ABOUT YOUR PROTOTYPE?

Will evaluators have any rights to include data in publications? ◦ If so, what type of data can be included?◦ How will the publications be reviewed?

Will evaluators have any rights to mention their involvement in the beta test?

Will evaluators have any rights to publicly comment about the prototype?

BALANCE BETWEEN THE INTERNAL NEEDS OF THE EVALUATOR AND

YOUR COMPANY’S COMMERCIAL NEEDS IS IMPORTANT

CONSIDERATION #8:WHO IS RESPONSIBLE FOR BUGS AND ERRORS ?

Will the prototype be provided “AS IS”?

Is it appropriate to limit your company’s liability? ◦ If so, what is the scope of the limitation?

LIMITED LIABILITY ENABLES YOUR COMPANY TO MANAGE RISK AND OFFERS GREATER PROTECTION FOR YOUR

COMPANY

CONSIDERATION #9:WHAT HAPPENS WHEN THINGS GO WRONG?

Will the evaluator have any obligation to protect your company from their use of the prototype?

Will you be able to act quickly if your trade secrets are disclosed?

How will disputes be handled? ◦ Negotiation/Mediation/Arbitration/Litigation

Who should bear the costs of breaches, errors and mistakes?

CONSIDER AVOIDING RISK FOR ACTIVITIES OVER WHICH YOUR COMPANY HAS NO AUTHORITY OR CONTROL

For more information contact: Ony Okoro at okoro.ony@apex-legal.com

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