What is a perpetual software license? (How does it work, when is it needed + more)

June 15, 2022

A perpetual software license is software that you pay a one-time upfront fee and keep the software. Additional fees are annual and include support and maintenances. This type of software pricing is ideal for individuals or companies that require software in their day-to-day activities.

Perpetual software licenses refer to the one-time purchase of software. That means you get to keep the software the same way when you purchase an appliance in the store, take it home, and use it on a need’s basis. In this case, the person doesn’t have to worry about making recurring payments as with subscriptions. However, what’s required is annual payments for support and upgrades.

What is a perpetual software license?

A perpetual software license is a pricing model where customers pay a one-time fee for the software. That makes it different from monthly or annual subscriptions, where you never get to keep the software and only rent it. With the perpetual software license, you keep and own the software and won’t make recurring payments to continue using the software.

How does a perpetual software license work?

The simplified understanding of a perpetual software license is how one can make a lifetime purchase of an item. For example, you can walk into a store, purchase a new fridge, and take it home after being given a warranty and maintenance service. Once the warranty is over, you have the choice of extending the warranty and maintenance service. Whatever the case, the fridge remains in your home.

When are perpetual software licenses needed?

Individuals or companies needing a particular software for everyday tasks are best served with a perpetual software license. It allows them to set up a smooth-running system that they can change based on their needs. However, the drawback is the software can be an outdated version of what’s in the current market.

Advantages and Disadvantages of perpetual software licenses

	Aspects of perpetual software licenses	Details
Advantages	Duration	Long-term use- you use the software forever
	Ownership	The customer owns and hosts the software after purchase
	Target market	Companies or individuals who need long-term software
	Cost	The customer is aware of how much they’ll pay
	Additional benefits	Yearly maintenance plans are available
Disadvantages	Cost	The costs of perpetual software licenses are usually high
	Relevance	The software used is not always up-to-date
	Annual maintenance and support costs	The customer pays for service and support services to receive updates and support where necessary

Conclusion

Perpetual software licenses allow users the freedom to own software and not rent it. It is often preferred over subscriptions since monthly or annual purchases can be cumbersome. The concern remains annual maintenance and support. However, those with these licenses must work with the software companies to provide updates, often at an additional fee.