A software license is a legal contract, which specifies the terms of use and the redistribution of the software. Apart from the public domain software, all other software is copyright protected. A typical software license defines the rights and imposes restrictions on the end users. These licenses also define different liabilities and responsibilities of the parties entering into the agreement.

Every software is required to be legally licensed, before it is actually installed. There are different types of software licences. The software manufacturers often come up with different terms for their licenses.

Types of Software Licenses

Freeware software is usually available free of cost. Such software is usually created by individual authors and are put into the public domains. Most of them do not have copyrights and can be used for unlimited period of time. Some of these software may have certain restrictions on their functionality; however, the true Freeware software do not have any restrictions, on distributions, modifications or use.

This kind of software is also called demoware or trialware, as it is available for using free of cost on a trial basis. The permissions are clearly stated in the documentations. For example, a software can be availed for free, for a trial period of ten days. The user will be charged for the full license of the program. After paying the charges, he will get the full functionality of the software and will not face any kind of restrictions applied to the free trial. The user will also get all sorts of updates for the software. This kind of software is generally downloaded from websites. The trial versions are often distributed along with magazines and newspapers.

Limited License
This kind of softwares is generally intended for non-commercial use. Only limited number of copies of this software are made available for the users. Limited licences, or LL, are often restricted to the designated number of computers, i.e. only certain number of users can avail it at the same time. This type of software is generally used by educational institutions or research centers. In educational centers these are restricted for using in on-campus computers, so that it can only be used for classroom instructions and research facilities.

Unlimited Site License
These software agreements do not set any limitations on the number of copies that can be distributed. These can be availed by different groups of people at the same time. For example, the government employees and the faculties of a university can use the same software at the same time. The users will not have to bear any extra cost apart from buying a burnable CD or the documentations. You can even check out the trial versions for one or three days or download them through the Internet.

Volume Purchase Agreement
This type of software is purchased in large numbers for reduced prices. These are usually sold to large companies in varying amounts of distribution. They may also be sold to schools or colleges in sets. Volume Purchase Agreements also allow to buy additional copies at reduced prices after the initial copies are distributed.