4 Software+license+agreements Final

Software license agreements
Dr Eszter Telek
IPR-Insights Consulting
IPR-INSIGHTS CONSULTING AND RESEARCH

1116 BUDAPEST, KONDORFA U. 10.  TEL.: (+36-1) 204-7730  FAX: (+36-1) 204-7731
E-MAIL: INFO@IPR-INSIGHTS.HU  WWW.IPR-INSIGHTS.HU
Licensing basics
Software and related materials

 executable code - on media / download from the
Internet
 software documentation (user guide, operational
guide etc.) – paper / electronic
 license (terms & conditions) – paper / electronic
 invoice or other documentation about the
procurement (containing all relevant information
in line with the license)
SOFTWARE IS LICENSED NOT SOLD

Licensing basics
License (licensing agreement)

 License is a specific agreement, in which the author
authorizes the use of his work and basically the user is
obliged to pay a remuneration (license fee) therefore.
 proprietary software (closed source)

 free software (open source)
 semi-free software
 BUT irrespective of remuneration software usage

have to be licensed by the author (vendor) every
time

Licensing basics
Closed source software

 commercial software
 freeware
 shareware
 other
 remuneration

Licensing basics
Open source software

 Free software
 GNU GPL
 Etc.

Licensing basics
Forms of software licenses

 Named license with unique ID
 generally agreements which are concluded by the
consensus of parties
 or other license confirmations (ie. belongs to a frame
contract etc.), which contains the name of the user
 in this case you do not need the invoice for certifying
legal usage (but you need it for accounting purpose!)
 Not named licenses
 retail boxes
 the agreement comes into existence by a real action
(opening the box etc.)
 in this case you have to own the invoice as well

Licensing basics
Terms of licenses
 Undefined term
 perpetual license
 perpetual license by divided payment
 Defined term
 subscription
 time limited test, evaluation license etc.

Licensing basics
Obligatory provisions
 direct subject: detailed rights to use the
software
 indirect subject: exact definition of the
work
 so it is a basic requirement that the
license agreement exactly defines the
software and the right which is granted
by the author to use it

Licensing basics
Extent of the license

 Identified number of software
 pieces and measurment type
 per device
 per server
 per processor
 per user
 per concurrent user
 per transaction (all other type of measures besides the above)
 combination of the above types (ie. per server+per device = MS
server + CAL model)
 etc.

Licensing basics
Rights of lawful acquirer

 Rights of lawful acquirer – granted by the Directive
 specific contractual provision can exclude the
following rights
 copying, adaptation necessary for lawful use,
including error corrections
 cannot be excluded by contract
 right to create back-up copies
 right of reverse engineering
 right of decompilation

Licensing basics
Possible user rights...
 using secondary computer

 downgrade right (right to use the previous
versions)
 Alternatively
 Concurrently
 Steps backward
 new version right (right to use the latest
versions)
 technical support
 training
 etc.
Licensing basics
... and restrictions

 territorial limitations
 limitation of the usable language
 edition limitation
 determination of the hardware
 determination of the user
 limitations regarding to license transfer
(affiliates, legal succession, outsourcing)
 etc.

Licensing basics
Miscellaneous
 warranty and liability
 termination of contract
 governing law
 arbitration
 etc.

Licensing basics
Supplemental agreements
 Upgrade license
 Update is diferrent (fix, patch, service pack)
 Maintenance agreement
 Support agreement

Licensing basics
Upgrade types
 language
 product (for example to change the edition)
 version
 competitive
 User has to own the base license to the upgrade

license in order to certify legal usage. (I.e
upgrade license is an amendment of the original
license agreement.)

Licensing basics
Typical software licences

 OEM license
 FPP license
 Volume license

Licensing basics
Big vendors – typical licensing models
 Customer types
 Levels
 Quantity
 Price
 Discount
 Rights and restrictions
 Good and well-known example: Microsoft

licensing models

Licensing basics
Licensing models of Microsoft

 Perpetual licenses
 FPP (box)
 OEM
 Open Business
 Select
 Open Value
 Open Value Company Wide
 Enterprise Agreement
 Subscriptions
 Open Value Subscription
 Enterprise Agreement Subscription

Licensing basics
MS FPP
 In the box: install kit, manual, license (in some
cases only electronic), registration form are
included
 Usually you can use only one version of the
software product
 Licensing terms are set out in the EULA
 There is no end user identifier on the license, so
you have to own an invoice (as conclusive
document)
 It’s the most expensive way of the software
procurement

Licensing basics
MS OEM software
 Software can be purchased with hardware:
 Operating systems
 Office (usually a special edition)
 Windows Server, SBS
 Usage of one version is permitted only (but there
is one exception)
 The license is electronic, COA label grants the
originality
 There is no end user identifier on the license, so
you have to own an invoice
 Product support provided by the hardware
supplier

Licensing basics
MS volume licensing models

 Named licenses
 Usage terms are set out in Product Use
Rights (PUR) document
 Downgrade right
 Software Assurance

Licensing basics
MS upgrade - Software Assurance (SA)

 It is used instead of earlier VUP, CUP, LUP, PUP
and UA models
 You are authorized to use the latest versions until
the agreement terminates
 You can order license (L) or license and software
assurance (L&SA) in Open / Select
 SA is included in OV/OV CW/OVS/EA/EAS
 Select customers can get SA by one-time
payment or by divided payment
 Renewal is available in the case of continuity
 Extra services can be provided in SA Program
 http://www.microsoft.com/licensing/sa/
Licensing basics
MS Open Business & Volume

 Two-year agreement
 Easy program to purchase software licenses
 From 5 licenses it can be required (Business)
 No install kit, no manual (procurable separately)
 Software Assurance can be ordered

Licensing basics
MS Select
 Licensing model for enterprises, only LAR
partners sell
 Min. 3-year contract
 Customers’ forecast determine the discount level
 Updated media are provided automatically until
the agreement terminates
 Educational and evaluation licenses for all
product
 Software Assurance is available

Licensing basics
MS platform agreements - advantages

 Simplified license management
 The standard computers in the case of Windows, Office,
and server CALs simplifies the license inventory to the
number of PCs
 Any version of the licensed software can be used
 One agreement for all license
 Upgrade periods can be handled easily
 Contain the new version of the licensed software
 Installations on demand

Licensing basics
MS Open Value
 Available from 5 licenses
 No minimum reorder
 Monthly order (notification), annual payment
 Price protection is provided from the order to the
termination of the agreement.
 Types
 Companywide option
 Non-companywide option

Licensing basics
MS Open Value Subscription

 Similar to the Open Value, but the most important
differences are:
 Annual order (notification) and payment
 At least 5 PCs
 Subscription: it is not a perpetual license, if the agreement
terminates, the use right terminates as well
 When the OVS agreement terminates, the included software
products can be purchased with perpetual use right; or the
products can be transferred to a new Open Value agreement
with SA

Licensing basics
MS Enterprise Agreement
 Perpetual license by divided payment:
after 3 years the usage right transfers to
the customer as a perpetual license
 Educational and evaluation licenses for all
the products

Licensing basics
MS Enterprise Agreement Subscription
 Similar to the EA, the most important

differences are:
• Subscription: it is not a perpetual license, if
the agreement terminates, the use right
terminates as well
• When the EAS agreement terminates, the
included software products can be purchased
with perpetual use right

Licensing basics
Licensing models of ther software vendors
 Transactional and contractual licensing

models
 Adobe
 Corel
 Symantec
 Etc.

Licensing basics
Thank you for your kind attention!


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Software license agreements

IPR-INSIGHTS CONSULTING AND RESEARCH

Software and related materials

SOFTWARE IS LICENSED NOT SOLD

License (licensing agreement)

 proprietary software (closed source)

 BUT irrespective of remuneration software usage

IPR-INSIGHTS CONSULTING AND RESEARCH

Closed source software

IPR-INSIGHTS CONSULTING AND RESEARCH

Open source software

IPR-INSIGHTS CONSULTING AND RESEARCH

Forms of software licenses

IPR-INSIGHTS CONSULTING AND RESEARCH

IPR-INSIGHTS CONSULTING AND RESEARCH

IPR-INSIGHTS CONSULTING AND RESEARCH

Extent of the license

IPR-INSIGHTS CONSULTING AND RESEARCH

Rights of lawful acquirer

IPR-INSIGHTS CONSULTING AND RESEARCH

Possible user rights...

 using secondary computer

... and restrictions

IPR-INSIGHTS CONSULTING AND RESEARCH

IPR-INSIGHTS CONSULTING AND RESEARCH

IPR-INSIGHTS CONSULTING AND RESEARCH

 User has to own the base license to the upgrade

IPR-INSIGHTS CONSULTING AND RESEARCH

Typical software licences

IPR-INSIGHTS CONSULTING AND RESEARCH

Big vendors – typical licensing models

 Good and well-known example: Microsoft

IPR-INSIGHTS CONSULTING AND RESEARCH

Licensing models of Microsoft

IPR-INSIGHTS CONSULTING AND RESEARCH

IPR-INSIGHTS CONSULTING AND RESEARCH

IPR-INSIGHTS CONSULTING AND RESEARCH

MS volume licensing models

IPR-INSIGHTS CONSULTING AND RESEARCH

MS upgrade - Software Assurance (SA)

MS Open Business & Volume

IPR-INSIGHTS CONSULTING AND RESEARCH

IPR-INSIGHTS CONSULTING AND RESEARCH

MS platform agreements - advantages

IPR-INSIGHTS CONSULTING AND RESEARCH

IPR-INSIGHTS CONSULTING AND RESEARCH

MS Open Value Subscription

IPR-INSIGHTS CONSULTING AND RESEARCH

IPR-INSIGHTS CONSULTING AND RESEARCH

MS Enterprise Agreement Subscription

 Similar to the EA, the most important

IPR-INSIGHTS CONSULTING AND RESEARCH

Licensing models of ther software vendors

 Transactional and contractual licensing

IPR-INSIGHTS CONSULTING AND RESEARCH

Thank you for your kind attention!

IPR-INSIGHTS CONSULTING AND RESEARCH

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