GAO: Software license mismanagement costs U.S. hundreds of millions

Licensing state-of-the-art software is supposed to help save the federal government money in IT efficiency, but a new study by the Government Accountability Office found that software mismanagement is costing many agencies millions in unnecessary costs.

According to GAO, the Office of Management and Budget and several other agencies inadequately manage their software licenses. Though OMB has implemented a broader IT management initiative, PortfolioStat, that includes some software licensing policies, it doesn’t assist agencies in developing comprehensive license management, the study said, something many agencies lack.

Of the 24 major federal agencies, the report found that just two — the Department of Homeland Security and the Labor Department — have comprehensive software policies “that include the establishment of clear roles and central oversight authority for managing enterprise software license agreements, among other things.” Eighteen of the agencies have policies, but they aren’t comprehensive. Four agencies — the Commerce and Interior departments, the Department of Health and Human Services and the National Science Foundation — have no policies at all. 

The potential savings could be significant, according to GAO, “considering that, in fiscal year 2012, one major federal agency reported saving approximately $181 million by consolidating its enterprise license agreements even though its oversight process was ad hoc.”


GAO placed the blame of federal software licensing weaknesses on OMB, saying it stems from “the lack of a priority for establishing software license management practices and a lack of direction from OMB.”

But some agencies are actually saving on software costs, according to the report. DHS claimed $376 million in savings between fiscal year 2013 and fiscal year 2015 using OMB’s PortfolioStat platform. NASA, the Commerce Department and the Department of Veterans Affairs also reported savings in recent years on software licensing.

Those are all examples of savings GAO said could be realized with better management practices throughout all agencies, specifically those related to data collection, but it’s up to OMB to implement any policy changes.

But Steven VanRoekel, U.S. chief information officer, disagreed with GAO, saying it should be up to the agencies to best manage their own software use.

“Because of this requirement to better manage software, agencies now have the tools to identify when there is underutilization of software and are better able to recapture those underutilized licenses and deploy them to people who need them,” VanRoekel said.


“Because of this policy, agencies are better equipped to tell the senior procurement executive exactly how many licenses of a given software product are deployed in the enterprise at a given time,” VanRoekel said. “This represents a new level of reliability in the extent of an agency’s requirement, and will greatly increase an agency’s ability to negotiate and deploy the software.”

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