What does an end-user license agreement cost? If you own a software application, this may be a question that you ask. So let’s explore this question and review general information about end-user license agreements and why these contracts are used.
How Much Does an End-User License Agreement Cost?
An end-user license agreement is a contract electronically signed by users when they download software. Sometimes called a EULA, licensing agreement, or click-wrap license, this agreement explains the software’s uses and restrictions. Common restrictions include:
- Sharing the software
- Distributing the software
- Copying the software
- Using the software for illegal purposes
The primary purpose of an end-user license agreement is to protect the original software creator by not allowing any users to profit from their intellectual property.
End-user license agreements usually appear when a user begins to download a program. Once the installation starts, the EULA will appear, and the user must acknowledge and agree to the terms and conditions to continue with the download.
End-user license agreements are precisely drafted to protect the vendor or the copyright owner and don’t provide any legal protection for the user. The software creator wants to ensure that their intellectual property is not copied for profit. They also need to ensure they are free from any liability related to the use of their program.
Many EULAs will have a hold harmless agreement that limits liability if the software damages a user’s computer or data. Some EULAs will also try to avoid liability for damages arising from improper use of the software.
An end-user license agreement is a software owner's first line of defense against lawsuits concerning the use of their product, so it must be drafted correctly. Therefore, it is recommended that vendors and developers hire a technology lawyer familiar with EULAs to draft this important agreement.
Based on ContractsCounsel’s marketplace data, the average cost of an end-user license agreement is $1,105.00.
What is Included in an End-User License Agreement?
End-user license agreements are generally standard documents that must include several key pieces of information. Every EULA should have clauses regarding licensing granting, restrictions for use, copyright infringement, and limitations of liability.
The following clauses are found in most end-user license agreements:
- Licensor. The software developer or vendor's contact information.
- Licensee. The user’s contact information.
- Software. The name of the software being licensed.
- License granting. An end-user license gives the buyer or user the right to use the application. Every EULA should include a clause stating that a license is granted.
- Warranty disclaimer. This clause states that the software is available “as is” and that the developer or owner isn't responsible for making any changes or improvements.
- Copyright infringement acknowledgment. States that any violation of copyright law assigns to the licensee.
- Maintenance and support. This clause describes whether maintenance and support are available and how they will be delivered.
- User restrictions. This clause describes how the user can legally utilize the software. For example, the EULA should include a section of restrictions prohibiting copying the license, using the software to break laws, or reproducing it.
- Limitations of liability. Limits the liability of the software owner for any damages that could occur as a result of the program or the misuse of the program.
- Start date. The date the user is bound to the terms and conditions of the EULA.
- Termination. Outlines the software provider’s rights to termination of the agreement. This usually occurs if the user violates a term of the contract.
- Governing law. The state laws apply if any dispute arises.
End-User License Agreement Projects
End-User License Agreement Drafting
End-user license agreements are important contracts that provide protections to a software developer or vendor. However, suppose this agreement isn’t drafted correctly or missing key clauses. In that case, it could leave a developer vulnerable to lawsuits and other legal action.
When a software developer hires a technology lawyer to draft an end-user license agreement, the lawyer will typically schedule a consultation. The consultation allows the attorney to get to know their client and learn about the software and its services.
After an initial meeting, the lawyer can draft a custom-tailored end-user license agreement.
End-User License Agreement Review
Many software developers choose to draft their end-user license agreements. These agreements are relatively standardized, so this is possible to do. However, before putting the agreement to use, it is always recommended to have an experienced lawyer review the contract.
End-user agreements are very technical contracts that require specific clauses to protect a software developer. One mistake could leave a vendor open to liability and expensive litigation. A lawyer with experience with EULAs can ensure that the contract includes all necessary information.
End-User License Agreement Drafting Cost
Hiring a technology lawyer to draft an end-user license agreement will incur legal fees because it requires the lawyer’s time and specialized knowledge.
ContractsCounsel’s marketplace data shows the average end-user license agreement drafting costs are $1,200.00 across all states and industries.
End-User License Agreement Review Cost
Suppose a software developer or vendor uses their end-user license agreement and hires a lawyer to review the contract. In that case, they will be charged for the lawyer’s time and services.
ContractsCounsel’s marketplace data shows the average end-user license agreement review cost is $1,005.00 across all states and industries.
How Do Lawyers Charge for End-User License Agreements?
Hourly Rates for End-User License Agreements
Under an hourly rate fee structure, a lawyer will keep track of how many hours they spend working on a client’s case or project. Then, once the job is completed, they will bill the client for the total number of hours at a predetermined hourly rate.
Hourly rate fee agreements ensure that lawyers are fairly compensated for their time working on a case. Lawyers with special expertise like technology or intellectual property can charge higher hourly rates than lawyers in more common fields.
ContractsCounsel’s marketplace data shows that the average hourly rate for a technology lawyer ranges from $250 - $400 per hour.
Flat Fee Rates for End-User License Agreements
Flat fee rate structures are commonly used for short-term projects like drafting an end-user license agreement. Under this fee agreement, a lawyer will estimate the amount of time a project will take and quote a client a total fee to be paid upfront.
ContractsCounsel’s marketplace data shows the average flat fee rate for an end-user license agreement is $1,105.00.
Get Help with an End-User License Agreement
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