William Caputo wrote a passionate blog entry on why “Software is not an asset” here:
http://www.williamcaputo.com/archives/000310.html
Although I entirely agree with ideas discussed about refactoring and removal of code, I do not think that the blog entry substantiates his claim that software is not an asset. An asset is:
Anything tangible or intangible that is capable of being owned or controlled to produce value and that is held to have positive economic value is considered an asset
Much of the software out there has a positive economic value either in productivity, revenue generation, cost reduction, or other types of economic value. I see removal of code and refactoring code into a more desirable design in order to support changing business needs as essential to countering depreciation of software assets. This was the foundation of Managing Software Debt: Building for Inevitable Change.
When we describe software only as a liability then we also provide reasoning to business that those who work on the software are part of a cost center. This is usually not the best way to operate any software development organization. The focus should be on optimizing the value that existing and newly created software assets support. Rather than only a liability, we can think of assets as what they are defined to be:
Assets are equal to “equity” plus “liabilities.”
The equity can still be there but if the liability is becoming so large that it outweighs the utility of the equity then we have a problem. We should counteract this decay in value by Managing Software Debt effectively as we produce new communications between the software and hardware assets we deploy.
