Types Of Licensing Agreements

In addition to controversial issues regarding end-user software licenses, partner licensing is also a common practice in the software industry. This occurs when a software developer licenses an application or more often an application component for use in relation to another developer`s software. Most standard software titles contain certain licensed components. For example, a graphic conversion filter in a word processing application can be developed by an external company and purchased either for exclusive or non-exclusive use in word processing. As you can see, there are many types of licenses. An experienced ip lawyer can help you understand the type of licensing agreement you need, as well as what should be included in this agreement. Those who enter into a licensing agreement should consult a lawyer, as there are complexities that are difficult for those who do not have a deep understanding of intellectual property law. A licensing agreement is what a partnership creates. It defines how partners perform, what all partners can agree on and how you can get out of the agreement.

Music recordings and scores are fully copyrighted, but face unique infringement and licensing challenges. To simplify, there is a wide and varied market for playing and distributing music in many environments, many of which are informal and do not require direct contact with licensees. Most music licenses are a very simple transaction for the payment of predetermined royalties, and no specific negotiations may be required. The American Society of Composers, Authors, and Publishers (ASCAP) and Broadcast Music, Inc. are the largest music licensing organizations in the United States and together collect more than $500 million in royalties per year. These organizations distribute royalties to copyright holders after deducting processing fees. They can also be distinguished in terms of licenses between business partners (easily defined) and licenses between property owners and end-users. End-user agreements are common for certain types of copyright licenses, especially for software and music. In this scenario, the end user simply pays for the limited right to use the property and generally does not attribute the property in any way. Most other types of licenses are part of a business strategy between separate companies, none of which can be an end-user of licensed ownership that will generate new third-party end-user sales. With respect to partner licences, the licensee should resell the property in one form or another. In May 2018, Nestlé and Starbucks entered into a $7.15 billion coffee licensing agreement.

Nestlé (the licensee) has agreed to pay $7.15 billion in cash to Starbucks (the licensee) for exclusive rights to sell Starbucks products (single serving coffee, teas, beans, etc.) through Nestlé`s worldwide distribution network.