A software license is the right to use a particular software package within the terms established by the vendor. Buying a software license differs in several ways from buying a packaged product. Normally, when you buy a retail version of a software package, the cost includes three components: the license (the right to use), the installation media and a manual. When you buy a software license you generally speaking only acquire the right to use the software, and the cost is designed to reflect this. Purchasing the license separately from the media and manuals makes it more economical for medium or large organisations to deploy software across several machines. It is important to note that purchasing the license does not automatically entitle you to a copy of the installation media or manuals, nor is possession of the media or the manuals the same as owning a valid license to use the software. Volume licensing arrangements with a software vendor allows business to buy their products at a discounted rate on the basis of the volume of their software
What can a software license cover?
- how long the software may be used,
- under what conditions or in what systems the software may be used,
- the support for the software (updates, upgrades, or technical assistance),
- the cost of the rights to use the software,
- the warranty terms, if any,
- the liability of each party for damages that result from the licensee's use of the software,
- ownership rights in the software, and any product that is developed using the licensed software,
- how and where any disputes will be resolved,
- the user's rights to obtain access to the source code from an escrow under certain circumstances, and
- any other issues important to the parties.