How does the App Store Handle App Licensing (you know, Software EULAs)?

In essence we are going to look at something I call ‘platform licensing,’ for lack of a better term in terms of the App store licensing (you know, software EULA and software licensing agreement issues). iPhone users for example, may notice (or in reality not notice) that they can purchase (nearly all the time) a software app in the app store without agreeing to any sort of end user license agreement as part of that purchase (they have to provide the iTunes password though). Quite frankly, this is one the great features of the app store, as it really makes the app purchase process easier and much, much smoother.

This model looks like a sublicensing model (where Apple sublicenses the app to the user), but in the iTunes agreement, Apple takes the stance (obviously for protection from claims, including patent infringement claims) that they really are an ‘agent’  (you know, someone acting for someone else) and the app license agreement is directly between the app creator and the user. I have not seen this ‘agent’ model used before in this context, but I am not saying it cannot be done or is not right.  In essence, Apple is saying that the user purchases the software from Apple (i.e. pays Apple for the software), but is actually licensing that software directly from the app creator, as Apple is only ‘an agent.’ Of course when an iTunes user agrees to the iTunes agreement (when installing iTunes) they are agreeing to the platform licensing agreement and the app store end user license agreement; this is a one time agreement, so no subsequent assent is required at the time of an app purchase from the app store.

Any way you look at it, I think Apple has done a fantastic job of using an upfront platform legal agreement, with no end user license agreement requirement at the time of purchase. Apple has something to show for it too, as it is now reported that over 2 billion software apps have been downloaded; quite an accomplishment for this platform-licensing model.

Any software-based company should take a look at these and other licensing models (with their attorneys of course) to see if they could work for them. While Apple is a really sophisticated provider of technology, you could take advantage of these licensing strategies to help accelerate your growth.