“ I agree ” and That’s it….

Sachin Tharaka
7 min readAug 11, 2021


Software License Agreements

Welcome Back…. What is your idea about software licenses? Read the below quotes. Is that the only thing you are doing with software licenses? Then this article for you.

“To most Christians, the Bible is like a software license. Nobody actually reads it. They just scroll to the bottom and click ‘I agree’.”
Bill Maher —

Only by looking at the above two statements, we can understand how easy people think about software licenses. They are correct, at the end of the day we have to do that but we must consider the contents of those agreements.

A software license is a legally binding contract between the owner or creator of a software program and the user that specifies how the product may be used and distributed. The duties of each party are explicitly specified in this agreement, preventing and protecting the developer from copyright infringement. Typically, the software license covers issues such as:

  • If the user can examine the underlying source code
    • If the user can copy, change, or redistribute the software
    • Where and how frequently the application can be installed

Why Software Licensing Is Important

Any program must be lawfully licensed before it may be installed. Otherwise, using the software might be deemed a copyright violation. Being aware of software licensing is especially essential for companies acting as users since you don’t want to pay for licenses that you aren’t utilizing. While obtaining too many might be a waste of time and money, having too few can expose a firm to an expensive prospective lawsuit. Furthermore, software licensing agreements may make maintaining your company’s software a lot easier, so finding the proper one is critical.

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 your program from being abused by consumers.

• Enables you to license software instead of selling it.

• Allows you to express your disclaimer of warranties.

• It restricts your liability.

  • Allows you to revoke licenses at any time.

Viewed under copyright law

Most software falls under one of two categories that have distinct differences in how they are viewed under copyright law:

Proprietary — also referred to as “closed source”

Free and open-source software (FOSS) — referred to as “open source”

Proprietary software licenses — do not allow for code modification or reuse, and often only include operational code rather than source code.

FOSS software licenses — provide the consumer rights to modify and reuse the software code, as well as giving the source code with the software product (s).

Types of Software licenses

1. License: Public Domain

When software is declared to be in the public domain, it can be used and modified by anybody without restriction. This is a “permissive” license that permits you to incorporate the code into your own apps or projects and reuse it as needed.

2. The GNU/LGPL stands for the GNU Lesser General Public License (LGPL)

Developers using an LGPL license have the ability to connect to open source libraries from within their own applications. When projects are built or linked to include an LGPL-licensed library, the resultant code can be licensed under any other sort of license — even proprietary.

3. Permissive

This is one of the most prevalent and well-known types of open-source software licenses. There are minimal limitations or requirements for the distribution or modification of software under a permissive license, commonly known as “Apache” or “BSD style.” The “MIT” license is another example of a permissive software license.

4. Copyleft

The conditions of this agreement are restricted — they’re known as reciprocal licenses. The licensed code may be changed or distributed as part of a software project under the conditions of a copyleft license if the new code is provided under the same software license.

This indicates that if the software product’s code was designated as being for “personal use only,”.

5. Proprietary

software licenses make it illegal to duplicate, alter, or distribute the program. This is the most restrictive form of the software license, as it protects the developer or owner of the product from illegal usage.

What Is Included in a Software Licensing Agreement?

Depending on the creator and the intended purpose, software licensing agreements can take on a variety of forms, but the majority of them have at least these four components.

General Information

This section contains information on the sort of agreement being formed, when it will take effect, and how long it will be in force.

Parties Involved

This part contains information on the people or firms who are signing the contract. You’ll need to specify whether each party is an individual or a corporation, as well as other pertinent information, such as each party’s

1. Name.
2. Contact information.
3. Address.


This part should include information on the agreement’s terms, such as the price of the license and whether it is a one-time flat charge or needs yearly fees.

• Having access to the coding

• If the license is a site license, it can be used on several computers at the same time as long as they are all in the same place.

  • The availability of support, maintenance, and refunds

Additional Details

Any conditions unique to your program or scenario that aren’t covered elsewhere in the contract should be included here. Signatures, dates, and a notation regarding any notarization requirements can all be included in this area.

Additional Clauses Often Found in Software License Agreements

Aside from the four major parts, there are a few clauses that give significant company protection, such as

  • Governing law -- This is where you decide which state or city will have jurisdiction over any legal issues that may arise.
  • Termination -- Establishing rules for the termination of an agreement helps you to demonstrate that you are legally entitled to cancel the license at any time and for any cause. You can also list the procedures that must be followed, such as uninstalling or deleting the software.
  • Limitations of liability -- Including this provision shields you from potential customer lawsuits by declaring that the customer accepts the software “as is” and disclaims any implicit guarantees regarding the program and its use.
  • Device usage -- The requirement for this part is mostly determined by how the program is licensed. You may take advantage of this chance to clarify if the customer is limited to installing the program on a single computer or whether this is a site license that covers numerous machines at a single location.
  • Breach of contract -- It’s usually a good idea to include a provision in a contract that specifies that failing to follow the conditions would result in a breach of contract. This allows you to define explicit consequences so that if the need arises, you can safeguard and restore control of your program.
  • Modification -- Unless you want users to be able to freely modify your software, which is not a good idea, you should add a section that explains what constitutes modification in this agreement and any rules you have for how your program can be updated.
  • Rights -- To prevent someone from purchasing a license and then stealing key components of your software for their own product, you must state that all rights to the software, including the name, software copyright, intellectual property rights, and distribution rights, remain your property even after the agreement has been signed.
  • Non-transferability -- If you don’t want the license to be transferred to another company or person, you’ll need this condition. Non-transferability provisions are frequent since transferred licenses restrict you from charging new consumers and because you won’t have an enforceable agreement with the new party once it is transferred.
  • Non-exclusivity -- If you want to license your software to other firms in order to maximize your revenues, you need to include a provision stating that your product is not unique to that client.

Regardless of the type of business, you’re in or the transaction you’re conducting, legally enforceable agreements, such as a software licensing agreement, is required. Before allowing customers to install and use your software, you must explicitly spell out your rights and expectations to safeguard both your product and your revenues.

Thank You!

#staysafe #stayconnected



Sachin Tharaka

Software Engineering, University of Kelaniya, Sri Lanka