Licensing-based Business Model
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A Licensing-based Business Model is a business model that is based on generating revenue by granting licenses that permit the use, modify, or distribute a product, service, or intellectual property under specified terms and conditions.
- Context:
- It can (typically) be reflected in a License Agreement.
- It can (often) include Usage Terms that outline what the licensee is permitted to do with the licensed product or service.
- It can generate revenue through License Fees paid by the licensee.
- It can specify Duration of Use indicating how long the license is valid.
- It can include Geographical Restrictions that limit where the product or service can be used.
- It can outline Support and Maintenance clauses that detail the support provided during the license term.
- It can encompass various types of licenses, such as Single-User License, Enterprise License, or Site License.
- It can be influenced by market demand, technological advancements, and regulatory environments.
- It can be used by companies to monetize intellectual property, software, creative content, and patented technology.
- ...
- Example(s):
- a Software Licensing Model where users pay for the right to use software applications.
- a Patent Licensing Model where a company grants other companies the right to use its patented technology in exchange for fees.
- a Music Licensing Model that allows artists to earn revenue by permitting the use of their music in various media.
- an Educational Licensing Model where institutions pay for access to digital textbooks and educational resources.
- ...
- Counter-Example(s):
- Sales-based Business Model, which involves the outright sale of products rather than licensing usage rights.
- Subscription Business Model, where customers pay recurring fees for continuous access to a product or service without specific licensing terms.
- See: License, Usage Terms, License Fees, Duration of Use, Geographical Restrictions, Support and Maintenance, Single-User License, Enterprise License, Site License, Software Licensing Model, Patent Licensing Model, Music Licensing Model, Educational Licensing Model