L is for License
When you purchase a piece of software for your computer, what you are actually buying is a ‘license’ to use that software. This license normally comes with conditions on it, such as a single-user license or a ‘family’ license which can be for up to five computers. Businesses often purchase site licenses, allowing them to use as many copies as they need in their office. It is normal for commercial software providers to use DRM (digital rights management) to limit software to licensed purposes. Licenses generally ban copying the software and may disallow reselling it or giving it away.Additional information can be found at http://atrilife.wordpress.com/2011/09/07/license-or-contract-the-form-of-the-open-source-license/.
Some small, independent software companies may provide software under non-commercial licenses. These include freeware (you pay nothing), shareware (normally, the basic version is free, but you pay for extra features), donationware (pay only if you want to) and open source (which allows other developers to take their software and legally create their own version). The Linux operating system is perhaps the best known example of an open source license. The most common open source license is GNU, which requires that derivatives stay open source.
Software licenses are part of how software companies control their intellectual property and secure their income, and may be very open or extremely restrictive. It’s important to remember that buying software does not mean you ‘own’ that copy, only the ability to use it.