Product activation is widely used by software vendors to safeguard their applications and enforce license agreements. While many users object to any form of license management, modern product activation systems can beat other techniques from both the vendor’s and the end-user’s perspectives.
Software vendors use license management for a variety of reasons. They can be concerned about protection from piracy, and protection against users exceeding their agreed license terms (like the amount of installations running in a customer company). License management also allows the software vendor to develop, distribute, and support one version of their application, but offer different license terms at different prices to several markets.
For example, owner will use the licensing mechanism to supply trial licenses, perpetual licenses, subscription licenses, set limits around the product features or modules enabled, set usage limits, combination’s out of all the above, and give straightforward upgrades in capabilities, all with only one executable (some license management systems even permit the vendor also to offer floating licensing either within the end-customer’s network or the Web on this same executable). Finally, license management can let the vendor to automate fulfillment, management and reporting, so reducing operations costs and offering immediate delivery worldwide 24×7 on their customers.
A vital concern for software vendors is ensuring users don’t merely provide the software to unlicensed friends and colleagues, as well as post it on the internet for anybody to download. The common solution is called node-locking, where each user’s installation is locked to 1 or even more parameters of these system, including the MAC address. Every time the approval runs, it reads, say, the MAC address of the computer where it is running, and can proceed only when the address it reads matches the main one recorded to the license.
Older processes for license enforcement include dongle-based licensing and key-file-based licensing. A dongle is often a hardware device that connects to anyone’s computer; if the application runs it checks to the existence of the dongle and will run only when it finds it. Dongles do therefore let the user to go their license around, however only by physically relocating the dongle. With key-file-based licensing, the license limits and node-locking parameters are encrypted within a file, which can be provided for the user and study with the application each and every time it runs.
These approaches have many disadvantages. Dongles need the distribution from the hardware, with all of that entails in material cost, shipping cost, delivery times and management by the vendor. They may be widely disliked by end-users, that do not wish to loose time waiting for the crooks to arrive, monitor them, keep these things stand out of the computer and so on.
Key-based licensing improves on dongles because encrypted key files can be delivered immediately by email, and impose no hardware burden. However, they are doing have to have the user to offer the names with the locking parameters (or run a utility to read them), and don’t allow users to readily move their license from machine to machine, therefore a move would require a new key file. An upgrade to a user’s license, such as extending a regular membership, also necessitates generation and delivery of the new key file.
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