U.S. Companies are Wasting Billions on Unused Software

U.S. companies are wasting a staggering $28 billion on software, according to an analysis of data over five years confidentially shared by 148 clients of global software firm 1E.

London-based 1E’s study defined a piece of software as “unused” if it hadn’t been run within the past 90 days and “rarely used” if it sat idle for 30 days.

Combining both definitions produced a total waste percentage of 38%, or the equivalent of $247 per software user or $7.4 million per business, the study found.

That’s a vast pool of potential savings for CEOs to tap as they struggle to maintain margins in the face of patchy economic growth and ongoing import competition from low-cost production hubs such as China.

The program found to generate the most waste was TechSmith’s Camtasia Studio, which is used to create tutorial videos and presentations. Here’s the top ten by waste percentage:

1. TechSmith Camtasia Studios (67%)
2. SAP Crystal Reports (63%)
3. Adobe InDesign (55%)
3. Adobe Dreamweaver (55%)
5. Microsoft Visio (47%
6. Adobe Illustrator (47%)
7. Microsoft Project Professional (46%)
8. Adobe Photoshop (42%)
9. Helios TextPad (40%)
10. Corel WinZip (34%)

“There is huge evidence of software waste across industries,” report co-author Buffi Neal said. “The inability of organizations to reduce average waste levels suggests they remain unaware of the underlying cost-saving opportunities.”

The aviation and education sectors experienced the most waste, at 47% each, while the pharmaceutical and insurance industries used software the most efficiently.

To address the problem, IE says it’s a simple matter of reducing the volume of new licence purchases. Even a conservative reclamation rate of 75%, for instance, could help save more than $182 per user, it estimated.