The federal government has been using technology escrow to safeguard their commercial off-the-shelf software for decades, but agencies appear hesitant to use this same protection for classified software and other technology.
Technology escrow is a service that mitigates the risk of technology acquisition. With an escrow contract, software source code or other IP from the developer is placed in a secure escrow account held by an escrow agent—a trusted independent third party. If in the future, the developer is no longer able to support the product for reasons specified in the escrow agreement—such as bankruptcy, obsolescence, merger or acquisition—the technology buyer will still have access to the source code, IP, and other “know how” to keep their mission-critical applications and systems up and running.
Any technical data package can be protected with a technology escrow agreement. If escrow will be required, the government entity should make this requirement known in the request for proposal. The DoD ESI Software Buyer’s Guide discusses source code escrow in Section 3.1.13, and the source code escrow is also included in the Software Buyer’s Checklist as part of the key terms to be finalized at the time of placing an order.
How Technology Escrow Works
When COTS technology is placed into escrow, the prime contractor developer is able to retain the IP rights, and the government buyer gains the assurances that the software source code or other technology will be available if needed. The independent, third party escrow agent makes this happen by providing a secure repository and creating an agreement that specifies release terms that detail under what circumstan ..
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