Analysts also noted that companies can guard against the unexpected shutdown of key vendors by working out an agreement to hire companies like Iron Mountain Inc., Escrow Associates Inc. or EscrowTech International Inc. to keep the source code of key products in escrow.
Davis, for instance, chose to implement a construction industry ERP software system from Computer Methods International Corp. only after the vendor agreed to a plan to keep the product's source code in escrow.
But for many companies, software escrow can be pricey, analysts said. The practice can also lead to legal battles if stored code is found to be defective or if the vendor claims that it is not contractually required to grant its release.
Such obstacles have led some businesses to turn instead to open-source software, though Davis notes that altering open-source technology to accommodate unique internal needs requires in-house expertise that not all companies have.
Moreover, the shutdown of a vendor of open-source software can be as bad as the closing of a maker of proprietary software. Analysts note that communities tweaking the most popular open-source products are employees of vendors that support the products. In those situations, the community "will definitely fade" if the vendor's business declines, Davis added.
For users of hosted software products, a shuttered vendor means the loss of service, analysts noted. One option is for such customers to use so-called SaaS escrows from service providers like OpSource Inc., which provides Web application delivery services.
Rather than giving customers access to the hosted product's code, explained OpSource CEO Treb Ryan, a SaaS escrow basically guarantees customers that they will continue to receive service for two or three months after a provider goes out of business.