Define: Computer Software
Computer Software, as used in contracts, refers to the computer programs (whether owned, licensed, or otherwise used by a party) together with related manuals, documentation, and supporting materials. The term establishes exactly what code and accompanying materials fall within the scope of a license, sale, development, or maintenance obligation between the parties.
Legal accuracy standard set & glossary spot-checked by Imad Mohammed Nazar , Skadden-trained M&A lawyer, Legal Engineer at GenieAI
What Computer Software Means in a Contract
Computer Software is a defined term used to identify the specific programs, applications, and code that a contract governs, along with the manuals and documentation that explain how to install, operate, or maintain them. It is a foundational definition because nearly every obligation in a technology contract, whether it concerns licensing, payment, support, or liability, depends on knowing precisely what falls within its scope.
In practice, the definition is drafted broadly enough to capture both the software owned by a party and any software it merely uses under license from a third party. This dual coverage matters because a business rarely builds every tool it relies on from scratch; much of its technology stack is often licensed-in, and a contract that only referenced owned software would leave significant gaps.
The inclusion of manuals and documentation within the definition is deliberate. Software without accompanying instructions, configuration guides, or technical specifications can be difficult or impossible to use effectively, so many drafters ensure that these supporting materials travel with the software itself under the same contractual protections and restrictions.
How Computer Software Is Defined or Measured
Unlike a financial or performance metric, Computer Software is not measured numerically; it is defined by reference to categories of materials. Typical definitions capture source code, object code, firmware, associated data files, and any updates, patches, or new versions released during the contract term. Some agreements distinguish between software that is embedded in hardware and standalone applications, since the rights and restrictions attached to each can differ.
Documentation is usually described broadly to include user guides, technical manuals, training materials, and specifications, whether in printed or electronic form. Because documentation can quickly become outdated, well-drafted definitions often clarify whether.
Relevant Circumstances
- When software owned or used by the company forms part of a deal
- If related manuals and documentation must be included in the transfer
- Where audit, escrow or licence-back rights apply to the software