EscrowTech India, an Indo-US joint venture, has become the first company to provide professional software and technology escrow services to clients in India. The joint venture is between Chennai-based Global Business Solutions, a consulting firm, and EscrowTech International Inc.
A software escrow protects a software licencee by ensuring that the licencee will have access to the source code (and possibly other materials) in the event that the licensor goes out of business, discontinues support of the licensed software, breaches maintenance obligations or some other release condition.
Addressing a press conference Sudhir Ravindran, director, EscrowTech India, said, "The company will provide for practical solutions for the protection of intellectual property, the other services will be technical verification, IP audit trail, IP archive, IP collateral and investment protection, IT evaluation and testing and IT dispute e-solution services."
As EscrowTech India is the first company to set its footprint in the provision of escrow services, so there is immense potential, he added.
Ravindran pointed out that the major thrust will be on creating awareness about escrow services to organisations. Escrow service happens when an independent third party stores the source code as part of the deal between the licensor and licencee. The escrow service agent would release the source code to the licensee only if a release condition occurs.
Companies use software escrow when the licence is for the object code (binary form) of the software but the licencee does not receive the source code and therefore is unable to maintain, update or enhance it. The licencee is dependent on the licensor for maintenance, updates and enhancements to the software.
Global Business Solutions holds 90 per cent stake in EscrowTech India and the remaining is held by EscrowTech International.
Ravindran said that the company hopes to break-even in a year's time. It already has as a couple of US clients offshoring their work. The equity capital invested in the company has been Rs 50 lakh.
