Will the MEGABYTE Act save money?

The MEGABYTE Act enshrines key Obama administration IT initiatives into law and promises to save at least $2 billion a year on software spending -- assuming implementation goes according to plan.

Shutterstock images (honglouwawa & 0beron): Bitcoin image overlay replaced with a dollar sign on a hardware circuit.

A recently signed law promises to save the government at least $2 billion a year on software. Even with the coming change of administration, lawmakers and industry experts are hopeful the measure will live up to its billing.

The Making Electronic Government Accountable By Yielding Tangible Efficiencies (MEGABYTE) Act, which became law on July 29, requires the Office of Management and Budget to direct agencies to establish software licensing policies with the goal of improving efficiency and using automated tools to maintain inventories of those licenses. It also gives agency CIOs more authority over the process.

The bill was backed by Sens. Bill Cassidy (R-La.) and Gary Peters (D-Mich.) in the Senate and Rep. Matt Cartwright (D-Pa.) in the House.

"In an era where everybody likes to pile on the government, this is one shining example where government is not only working but working effectively," said Jim Ryan, CEO of Flexera Software.

Smart asset management can help an organization save roughly 30 percent of its annual spending on software, according to Ryan. But he said having a software asset manager, who has a plan for how to manage the licenses, is essential. Agencies that already have such a person in place "are off to a better start."

"I'm not quite sure how the bureaucracy is going to respond, but reasonably, if someone buys software [and] has the license associated with the software, someone would keep inventory," Cassidy told FCW.

Unlike previous efforts, he said the law requires agencies to better manage their software spending, and the biggest challenge will be getting agencies to change their standard practices.

Cassidy said agencies need to adopt stricter accounting practices when it comes to software license inventories. "I would hope that [the Office of Personnel Management] has now taken care of all of the issues that allowed them to be hacked," he added. "Hopefully they will also take care of a lot of the issues that allow millions of dollars to be wasted in unused software licenses."

Ryan said there is a direct link between software management and security, and an accurate inventory is necessary to complete basic security tasks such as patch management and access configuration. He added that a governmentwide emphasis on cybersecurity will propel agencies to do the right thing where software licensing is concerned.

"If you don't know what software is out there and you don't know what is being used, it's impossible to figure out how to save money," Ryan said. On top of that, the urgent need to mitigate software vulnerabilities makes "this a pressure-packed environment in a healthy way."

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