Software License
Hello everyone!
In this article, I’m going to talk about the Software License. I mainly cover here what is a software license, types of software licenses, copyright law, and ownership vs licensing. So, Let’s start.
What is a software license?
A software license is a legally binding agreement made between the owner or developer of a software program and the user, outlining how they can use and distribute the product. In this document, the responsibilities of each party are clearly defined, preventing and protecting the developer from infringement of copyright law. Typically, the software license addresses things like:
- If the user can view the underlying source code
- If the user can copy, alter, or redistribute the program
- Where the program can be installed and how frequently
Before any software can be installed, it has to be legally licensed. Otherwise, it would be considered a breach of copyright law to use the software. I explain what is copyright law later in this article. For businesses acting as users, being aware of software licensing is particularly important because you don’t want to unnecessarily pay for licenses that you aren’t using. While acquiring too many can be a waste of a company’s resources, having too few can leave the company vulnerable to a costly potential lawsuit. Additionally, software license agreements can make managing the company’s software way easier, so it’s important that you find the right one.
As a software developer, software license agreements protect the investment of time, energy, and resources, ensuring that you will be able to make a profit from your hard work. Some of the other motivations for obtaining a software license agreement are because of it:
Prevents customers from abusing your software. Without getting a signed licensing agreement, there’s nothing stopping your customer from attempting to copy your software for their own benefit. Usually, customers that try to copy software do it so that they can install it on multiple computers, saving them money, but they could also try to sell it for a profit. Either way, this could cost you potential income.
Allows you to license the software without selling it. You can let customers pay for a license of your software while maintaining all rights to it, allowing you to license it out with restrictions placed on its use. This essentially gives you more control over how your software is both used and distributed and gives you the chance to make more money over time.
Gives you the chance to disclaim warranties. Customers have certain expectations any time they purchase a product, and your software is no different. By incorporating a disclaimer of warranties in your license agreement, you can require the user to accept the software as available or as-is, putting the risk on them.
Limits your liability. Limiting your liability is extremely important because it helps protect your company against potential lawsuits.
Allows you to freely revoke licenses. Including this section of the agreement gives you the freedom to revoke or suspend licenses at any time, and for any reason, helping you keep complete control over the software.
Types of software licenses
If you write code, you also reuse code, including code snippets, libraries, functions, frameworks, and entire applications. All software code comes with certain rights and obligations if you want to add it to your codebase. Free and open-source software (FOSS) is free of cost, but you aren’t free to use it as you wish. Even unlicensed code snippets copied from Stack Overflow have obligations for reuse. But formally developed code usually comes with a specific software license.
Different types of software licenses require you to meet certain obligations if you want to reuse the code. There are five main software license categories or types used to cover different kinds of software and various business arrangements. These encompass a wide spectrum of licensing scenarios, from free software (public domain) to paid commercial software (proprietary).
Between these two extremes, there are also three categories (GNU/LGPL, permissive, and copyleft) that apply to various forms of open-source projects. Failure to follow the terms and conditions of an open-source license can lead to revealing trade secrets or even legal action from the project’s developers.
1. Public Domain License
When software is defined as being in the public domain, anyone is free to use and modify the software without restrictions. This is a “permissive” license that allows adopting the code into applications or projects and reusing the software as desired.
For many reasons, businesses must exercise caution when adopting public domain software in projects or other important applications:
· Public domain software may not always adhere to best coding practices or may not be up to standards of secure software that the application requires.
· Software that does not fall under specific licensing terms is not always public domain code. Be sure the software is truly public domain before copying, reusing, or distributing it.
2. GNU/LGPL GNU Lesser General Public License (LGPL)
Under an LGPL license, developers have the right to link to open source libraries within their own software. The resulting code can be licensed under any other type of license even proprietary when projects are compiled or linked to include an LGPL-licensed library.
The caveat is that if any part of the library is copied into the code or modified, the terms of the original LGPL license will apply to the developed code that used the library.
3. Permissive
This type of license is one of the most common and popular among open-source software licenses. Under a permissive license also referred to as “Apache” or “BSD style” there are few restrictions or requirements for the distribution or modifications of the software. Another variation of a permissive software license is the “MIT” license.
Variants in permissive licenses include differences in requirements for preserving license notices and copyrights for the software, as well as how the software may be used (commercial or private), trademark requirements, and other stipulations.
4. Copyleft
This license’s terms are restrictively known as reciprocal licenses. Under the terms of a copyleft license, the licensed code may be modified or distributed as part of a software project if the new code is distributed under the same software license.
This means that if the code included in the software product was specified to be for “personal use only,” the new product being distributed must carry that same designation/restriction.
Since the original software included with the new project allowed modifications and distribution, this may not be the best license for software developers because the resulting code must also carry the copyleft license type including the availability of the source code.
5. Proprietary
These software licenses make the software ineligible for copying, modifying, or distribution. This is the most restrictive type of software license, protecting the developer or owner from unauthorized use of the software.
How Does Software Licensing Work?
New users of the software will normally enter into an end-user license agreement (EULA) that constitutes a legal definition of the relationship between the licensor (provider) and licensee (user or business). The EULA is a contract that establishes the rights of the purchaser for installing and using the software.
Every EULA contains a clause that stipulates when its conditions are activated by an end-user. This may be the moment the user opens the product packaging or, for example, when the user clicks on a button agreeing to accept the EULA’s terms to access it.
Cloud-based applications such as Software as a Service (SaaS) will often include license details in EULAs including:
- Monthly or annual charges per user
- Duration of the agreement
- Terms of cancellation of the agreement
- Recovery of any charges if canceled during the agreement
Additional use of software licensing is in cases where a software developer or firm grants authority for selling or distributing the software under the second party’s brand. The developer retains ownership, but the re-branding company is permitted to resell the software product. This method of licensing is called “white labeling.”
Benefits of licensed software
· You’ll receive technical help with genuine software, ensuring reliable support system.
· You get full instructions and documentation with the product, giving your clarity on usage rights.
· You get access to updates, upgrades, and security patches, to suit your technology needs and improving your computing experience.
· You avoid unnecessary IT & cybersecurity risks to your computers and network, and theft of confidential business information.
· If you use pirated software, you could face a civil or criminal action under the copyright laws, impacting your reputation.
· Software piracy has a negative impact on the economy by way of loss of jobs, taxes, R&D and innovation.
· Having “Legal IT” or in other words “genuine and licensed” software speaks volume about your reputation and governance.
· Your relationship with the IT partners and publishers improves, creating mutual trust, leading to best bargains.
· With genuine software, you and your employees get peace of mind, leading to improved productivity and efficient management.
· You experience a high-level of IT maturity in your organization, making you highly competitive in the market place.
What Is a Software License Agreement?
A software license agreement is a legal document that stipulates several key conditions between a software company or developer and a user to allow use of the software.
These conditions are designed to protect the developer’s intellectual property rights and to limit claims against them for potential damage resulting from use of their software. In some cases, pricing and terms of payment may also be included, though this is often covered in a separate document. The primary purpose of the agreement, however, is to provide detailed ground rules for use of the software:
- Where the software may be installed and how many instances may be installed.
- How the software can be used.
- Whether the software may be copied, modified, or redistributed.
- Any copyrights that apply to the software.
- Ownership of the software — most often specifying that the provider retains all rights of ownership.
- Duration of the terms of the agreement.
- What constitutes correct usage of the software.
Copyright law
A copyright is a collection of rights that automatically vest to someone who creates an original work of authorship like a literary work, song, movie, or software. These rights include the right to reproduce the work, to prepare derivative works, to distribute copies, and to perform and display the work publicly.
While copyright law is intended to serve the purpose of enriching the general public through access to creative works, it’s important to understand that it imposes no obligation upon creators to make their copyrighted works available.
There are some limitations on the rights granted to copyright owners. Under certain circumstances, anyone can use a work without getting the copyright owner’s permission or paying the copyright owner to use it.
There are three basic requirements that work must meet to be protected by copyright.
Original: To be original, a work must merely be independently created. In other words, it cannot be copied from another.
A Work of Authorship: To qualify as a work of authorship for the purposes of copyright protection, a work must be a product of creative expression that falls under a category of copyrightable subject matter. Copyrightable subject matter includes a wide range of works, including literary works, musical works, motion pictures, and other audiovisual works, derivative works, compilations, and many others.
Fixed: To meet the fixation requirement a work must be fixed in a tangible medium of expression. Protection attaches automatically to an eligible work the moment the work is fixed. A work is considered to be fixed so long as it is sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration.
Ownership VS Licensing
When you purchase software, you receive a copy of the software and a license to use it. You don’t actually own the software ownership rights belong to the software company, and you’re still limited by the terms and conditions of the license.
A software license gives you the right to use a software product. It also governs the use of the software along with the copyright laws, which prevent the unauthorized distribution or reproduction of the software. A license might also specify, among other terms and conditions, whether or not you may install the software on more than one computer and whether or not you can create backup copies of the software.
Even free software, otherwise known as freeware, might come with a license that dictates its use. This is generally in order to prevent a user from altering the software in an attempt to resell it.
Before you install an application, always read the license. Most vendors won’t negotiate or modify a software license; if it includes unfair or unreasonable terms, your only recourse might be to return the software to the vendor.
Thank you very much for reading!
Hope to see you again with another article. Till then, Goodbye All!
