What is Software licensing and why is it important

What Is a Software License?

Software licensing is a form of legal binding agreement that is carried out between the developer of a software program and its user. These agreements tend to define and outline the use and distribute conditions of the software program. The software licensing documents are drafted in order to thoroughly define out the responsibilities of both parties. They are there to ensure that there is no infringement of the copyright laws.

These may include the conditions like whether the user is allowed to view the underlying source code.Other factors like copying, alteration and redistribution of the software program also come under the software licensing. Moreover, how frequently can the program be used and where may also be one of the few conditions that are drafted within the licensing.

Why is Software Licensing so Important

While it is quite evident why software licensing can be so important, to define it out more specifically, it’s mandatory. Before installation, a software needs to be legally licensed otherwise this could be counted as a breach of copyright law. Such a breach can often lead to a potentially costly lawsuit. Companies require licenses to become users of a certain software, this is particularly important. Lacking licenses for the software that they use can cost them a fortune. Moreover, these licensing agreements are vital to ensure smooth management of the company’s software.

For software developers, licensing agreements can save a great deal time and energy. They ensure that your hard work will pay off properly and that you are able to make your due profit.

Other reasons for Software licensing include:

  1. It may prevent the misuse of your software. Licensing agreements ensure that your customer doesn’t try to copy your development for their own personal benefit. They may attempt this by copying your software and installing it on multiple devices with the intention to save on money. Moreover they can copy with the intention to sell it for their own profit. Licensing can save you from the loss of potential income.
  2. Software licensing allows you to have rights over your software. This means that you can place restrictions on its usage, therefore allowing you to control the usage of software and decide how you intend to profit from it without selling it.
  3. Licensing allows you to add warranties and disclaimers. This means that the user may have to accept all the risks and expectations that come with the software.
  4. As a potential user of a software, Licensing may limit your liability and protect you from any potential lawsuits.
  5. You can also revoke the license or suspend them at will. This gives you complete control over your software.


Many companies tend to use software licenses in order to meet the legal requirements of using software. This ensures that there are no misunderstandings between the both developer and user parties. Software licensing ensures a consensus of fair usage between the licensor and the licensee. These clearly define the terms and conditions of usage and help prevent any kind of misuse of the software.

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