Software license

Most distributed software can be categorized according to its license type (see table).

In addition to granting rights and imposing restrictions on the use of copyrighted software, software licenses typically contain provisions which allocate liability and responsibility between the parties entering into the license agreement. In enterprise and commercial software transactions, these terms often include limitations of liability, warranties and warranty disclaimers, and indemnity if the software infringes intellectual property rights of anyone.

Software licensing often also includes maintenance. This, usually with a term of one year, is either included or optional, but must often be bought with the software. The maintenance agreement (contract) typically contains a clause that allows the licensee to receive minor updates (V.1.1 => 1.2), and sometimes major updates (V.1.2 => 2.0). This option is usually called update insurance or upgrade assurance. For a major update, the customer has to buy an upgrade, if it is not included in the maintenance agreement. For a maintenance renewal, some manufacturers charge a reinstatement (reinstallment) fee retroactively per month, in the event that the current maintenance has expired.