The Software Licensing Jargon Buster

10 terms that you need to know when renewing, purchasing or managing software

Software licensing is a crucial part of your business. From using Outlook to send emails through to making conference calls and paying suppliers; today, the vast majority of daily work and operations are facilitated by software applications. However, managing your various software assets can quickly become complicated – especially when you have to deal with different licensing agreements across a large number of users.

The excess of technical terminology, abbreviations and shorthand just makes matters worse – so here is our Software Licensing Jargon Buster, designed to help you better understand typical terminology around software licensing agreements, to help you negotiate and manage to your full potential.


  • SAM
    Abbreviation for ‘Software Asset Management
    First thing’s first. Before we get into the nitty gritty of software licensing terminology, we need to be clear on what SAM refers to. Software Asset Management is the practice of managing software assets within a business. Broader than software license management, SAM includes planning for and managing software through its lifecycle in a systematic manner with the active involvement of top management. SAM includes managing and optimising the purchase of software applications as well as the deployment, maintenance and usage of software applications throughout their lifecycle.
  • ITAM
    Abbreviation for ‘IT Asset Management’
    ITAM encompasses the management of all IT assets within the business, including hardware and software and covers the financial, inventory, contractual and risk management responsibilities for managing these assets. Both SAM and ITAM are key components of the Information Technology Strategy of every organisation. They help reduce IT costs and limit the security and legal risk associated with the ownership of software or hardware assets, while improving end-user productivity.
  • CAL
    Abbreviation for ‘Client Access License’
    CAL is a user or device-based commercial software licence providing access to vital systems such as exchange servers, file services and mail servers among others. Each CAL license allows one user to connect to the server software whenever they need to. You can purchase multiple user CAL licenses but once the CAL has been allocated to a user, it cannot be used by another one (though it would work on multiple devices used by that user). The device-based CAL works in pretty much the same way, but it limits the number of devices which can connect to the server, rather than the number of users.
  • EA
    Abbreviation for ‘Enterprise Agreement’
    A company-wide bulk licensing agreement applicable to the entire organisation for a fixed period of time (usually longer than 12 months). It typically allows unlimited use of the programme throughout the organisation for the duration of the agreement, although in some cases there may be restrictions and limitations. This type of software license is particularly useful for large organisations and SMEs that need unlimited access to an application for multiple users.
  • EULA
    Abbreviation for ‘End User License Agreement’
    This agreement spells out the rights and obligations of the user and the software provider. Many EULAs are only provided in digital form, and only presented when downloading the software for the first time or signing up to a website. Many EULAs assert extensive liability limitations, so it is important to encourage your employees to read carefully these EULAs before their sign up to new online services/subscriptions on behalf of the company.
  • MVL
    Abbreviation for ‘Microsoft Volume Licensing’
    Microsoft Volume Licensing is a type of licensing that provides multiple Microsoft product licenses, but not multiple copies of the software media and the documentation that comes with the software. MVL typically comes with lower pricing and in many cases doesn’t cover use rights such as rights to copy the software onto multiple devices.
  • POL
    Abbreviation for ‘Proof of License’
    Proving that all your business applications are legally licensed under the right licensing model could be quite a challenge. Many publishers now offer licenses online, which eliminates a great deal of confusion when it comes to proving validity of software. However, not all publishers provide a foolproof license programme. This is why it’s important have Proof of License. When you purchase or renew a software license, make sure you keep your Licensing Agreement (LA) and Ordering Document (OD) and check if your software provider can give you a Proof of Entitlement (PoE) certificate or License Information Document that defines the specific terms of your licensing agreement.
  • PUR
    Abbreviation for ‘Product Use Rights’
    The Product Use Rights is a document which includes information about the universal license terms, product specific terms, notices and software assurance benefits that come with your Microsoft Volume Licensing agreement.
  • SA
    Abbreviation for ‘Software Assurance’
    SA is a certificate of quality provided by software vendors to ensure that the processes, procedures, and products used to produce the software meet all relevant industry standards. This is particularly important for business applications that support critical functions and rely on the predictable operation of software.
  • SLM / SLO
    Abbreviation for ‘Software Licence Management / Software Licence Optimisation’
    Software License Optimisation is the ongoing process of proactively managing the software assets across the business throughout their lifecycle to maximise their utilisation and maintain license compliance.

To find out more about software licensing, please check out our SAM Certification page: