Software Licensing Models Compared
A licensing model is the rule that decides what a customer may use, for how long and how much. Most products end up with two or three of them, for example a free trial, then a subscription, with a few premium features sold on top. In Labs64 NetLicensing every product module uses one licensing model, and a product can have as many modules as you like, so mixing models is easy.
Comparison
| Model | What it limits | Where it’s used | What your app sends on validation | NetLicensing page |
|---|---|---|---|---|
| Perpetual | Nothing once bought | Desktop tools sold once | Nothing extra | Try & Buy with the shortest evaluation period |
| Trial (Try & Buy) | Evaluation time, then a purchase | Downloadable software with a free trial | Nothing extra | Try & Buy |
| Subscription | Calendar time, renewable | Monthly or yearly licenses, maintenance plans | Nothing extra | Subscription |
| SaaS plans | The plan and its features | Free, basic and premium tiers; freemium | Nothing extra | Pricing Table |
| Feature-based | Single features or editions | Lite, pro and enterprise editions; add-ons | Nothing extra | Multi-Feature |
| Node-locked | Number of devices or named users | Workstation software, hardware-bound licenses | A node secret (fingerprint) | Node-Locked |
| Floating (concurrent) | Sessions at the same time | Engineering and enterprise tools shared by a team | A session ID plus check-out or check-in | Floating |
| Usage-based | Credits used | API calls, processed documents, compute time | The quantity used or reserved | Pay-per-Use |
| Quota | Capacity | Seats, storage, projects, requests per day | Nothing extra; your app compares its own usage with the quota | Quota |
| Rental | Time per instance | Devices or assets, each licensed for its own period | Nothing extra | Rental |
| Discount | Price | Promo codes and campaigns in the shop | Doesn’t apply | Discount |
Picking a model
Start with how customers pay: once (perpetual), per period (subscription or SaaS plan), per use (pay-per-use) or per unit of capacity (quota).
Then decide whether there’s a trial or a free plan. Try & Buy has a trial built in, Subscription can hand out a free period automatically, and Pricing Table can have a free plan.
Next, what does one license cover? It could be a device (node-locked), a concurrent user (floating) or an account or tenant, which is simply the licensee itself. For named users, either use the user ID as the licensee number or use node-locked with the user ID as the node secret.
Last, if some features are sold separately, add a Multi-Feature module, or list the features per plan in Pricing Table.
Combinations we see often
| Scenario | Combination |
|---|---|
| Desktop app with a trial and a yearly license, two devices per customer | Subscription with a free automatic license, plus Node-Locked with quota 2 |
| SaaS with free, pro and business plans and paid add-ons | Pricing Table plus Multi-Feature |
| Team tool sold as concurrent seats per year | Subscription plus Floating |
| API product with prepaid credit packs | Pay-per-Use, with Subscription for platform access if you charge for it |
| Fleet of devices, each licensed for its own period | Rental |
How to license a product using multiple licensing models shows how to set this up.
Related comparisons
- Node-Locked vs Floating Licenses
- Subscription vs Perpetual Licensing
- Usage-Based Software Licensing with Metering and Quotas
- Licensing a SaaS Application
- The full list, including planned models: Licensing Models