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A software license is the permission to install the software for a specified number of users within the organization. The license restricts what you can do with the software, where you can install it, and how long you may use it. Pricing tiers allow the organization to realize greater savings with larger purchases. The means by which the software is delivered may be via media disks or by electronic download.
Contractual Licensing Program
Per license pricing tier (level) is based on actual volume of initial sale or projected volume over the term of the contract and is determined by the software publisher. Pricing tier per license is the same regardless of quantity on any particular order. The agreement can be renewed at the end of the term.
Transactional Licensing Program
Pricing tier is based on the quantity on a given order. Additional licenses purchased at a later date may be priced according to the tier achieved by the new order, or add-on licenses may be allowed at the initial order pricing tier. Examples: Symantec, McAfee, Filemaker, Sassafras, Techsmith, VMWare.
Perpetual License– license is valid for the version purchased forever. License may be upgradeable to new versions by purchasing an upgrade license, or the ability to upgrade may depend on purchasing upgrade maintenance. Examples: Adobe CLP license, Microsoft Select license, Symantec, VMWare.
Subscription License– license is only valid for a fixed term, ranging from one to three years and needs to be renewed at the end of that term. Subscription licensing usually includes upgrade maintenance, allowing the user to upgrade to new versions as they are released during the subscription term. Examples: Microsoft Campus Agreement, Adobe ETLA Site License, Adobe VIP license.
Site License – license that allows installation on every computer at a school. Pricing is usually based on full time equivalent (FTE) employee count.
Examples: Microsoft Campus Agreement, Adobe ETLA Site License.
Upgrade maintenance allows the software to be upgraded to new versions as they are released. This is the most cost effective way to keep the licenses up to date over time and to avoid having to purchase new licenses. Maintenance is either included with the licensing (as in most subscription licensing), or purchased as a separate optional or required item with the original license. Maintenance is valid for a fixed term and can be renewed at the end of that term.
Upgrade Maintenance for Contractual Programs – pricing for maintenance during the term of a contractual program is pro-rated for the months or years remaining in that term so that all maintenance is co-terminous with the agreement.
Upgrade Maintenance for Transactional Programs – pricing for maintenance under transactional purchasing programs covers upgrades for a fixed term, usually 1 year. That period begins when the order is processed by the software publisher. Additional license purchases with maintenance will often have different expiration dates than those in the original purchase, since the term of the maintenance for the new licenses begins with the new transaction date. Examples: Symantec, McAfee, Techsmith, Filemaker, VMWare.
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