What Is a Software License?

A software license grants you the right to run or access a software program. Licensing software is different than purchasing a car or house in that you have the right to run the software but there are ongoing requirements that determine how the software can be used. These requirements include such things as deployment eligibility, transferring software to other users, and downgrading to earlier versions of the software.

Microsoft software licenses generally come with one of two kinds of agreements which specify how you may use the software. The first kind, and the one most users are familiar with, is an End User License Agreement (EULA). If you have ever acquired a license for software from a retailer or purchased a new computer with software already installed, then you have probably seen a EULA. The EULA generally either comes in the box on paper or cardstock or pops-up onscreen when you install new software. You typically must accept the terms and conditions before installing the software. The second agreement type, Product Use Rights (PUR), is similar to the EULA except that it pertains to software licensed through a Microsoft Volume Licensing program. The PUR, together with the Microsoft Volume Licensing program agreement under which a license is acquired, governs the use of Microsoft Volume Licensing software.

Choosing a Volume Licensing Program

Before deciding if volume licensing is right for your organization, consider these questions:

• How often will you upgrade your hardware and software?
• What priority does your organization put on training?
• What software will you need to build the solution that meets your objectives?
• Are you interested in spreading out payments?
• How do acquisition costs and ease of deployment affect your decision?
• Does your organization need multiple copies of software?
• Is it important for your organization to deploy the most current Microsoft software?
• Does your organization prefer to acquire licenses for software when needed, or is standardization important?

If you answered yes to any of these questions, then volume licensing might be the solution for your organization.

Begin Choosing Your Solution

Answer the preceding questions and consider which of the following volume licensing programs most accurately describes your organization and meets your priorities.

Your Organization Has Fewer Than 250 Computers

The Open License program's flexibility and low entry requirements make it a great program for organizations with fewer than 250 computers. Open License offers three variations to meet many organization's needs. Open License program offerings are available through a broad reseller channel base such as retail stores, solution providers, and online vendors. There are three Open License program offerings to choose from.

• Open License Value. For organizations with as few as five desktops that would like the advantages of Software Assurance and the ability to spread payments annually.
• Open License Volume. For customers able to acquire 500 points in a single pool upfront. This offering provides additional potential savings compared with the other Open License offerings.
• Open License Business. This program requires an initial acquisition of only five licenses.

Your Organization Has More Than 250 Computers

If your organization has more than 250 computers, then you should consider the Select License, Enterprise Agreement, or Enterprise Agreement Subscription programs, which may fit your organization's software needs and acquisition models more closely. These programs are offered through Microsoft Large Account Resellers (LAR) and Microsoft Enterprise Software Advisors (ESA).

• Select License is designed for organizations with mixed software and acquisition requirements. Select License customers receive a volume price level for each pool of software selected (applications, systems, or servers) based on a three-year software forecast. At the end of the agreement the customer can continue to use the software properly licensed and paid for. A customer can renew any Software Assurance that was acquired to continue receiving the associated benefits.
• Enterprise Agreement is designed for organizations that prefer to standardize their Microsoft software throughout their organization based on the Microsoft enterprise products (Microsoft Office Professional, Microsoft Windows Professional desktop operating system upgrade, and Core Client Access License) at prices based on a three-year agreement term. At the end of the agreement, the customer can continue to use the software properly licensed and paid for. A customer can renew their Enterprise Agreement enrollment to continue to receive the associated benefits and use any later versions of the software that become available during that renewal term.
• Enterprise Subscription Agreement is designed for organizations that prefer to standardize their Microsoft software throughout their organization based on the Microsoft enterprise products (Microsoft Office Professional, Microsoft Windows Professional desktop operating system upgrade, and Core Client Access License) at prices based on a three-year agreement term. At the end of the subscription the rights to use the software end and the customer must either uninstall the software or renew its Enterprise Subscription enrollment.

Next Steps

Your next step should be to speak with a Microsoft representative, Microsoft solution provider or Microsoft reseller. Microsoft has a worldwide network of solution providers and resellers that can help you choose the right Microsoft Volume Licensing program for your software needs.
Microsoft Licensing Options
Microsoft licenses software three primary ways:

Full Packaged Product
Full Packaged Product (FPP) is boxed, shrink-wrapped software. Licenses for this type of software are acquired through retail outlets. 

Original Equipment Manufacturer
Original Equipment Manufacturer (OEM) and System Builder software licenses are acquired when you buy a computer with software legally preinstalled. Microsoft Office and Microsoft Windows® are examples of this type of software.

Volume Licensing
Microsoft Volume Licensing programs may be the right choice for your organization if you need multiple copies of Microsoft software. Volume licensing is a flexible and economical way to acquire from five to thousands of licenses for software.