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An End User License Agreement (EULA) is a contract between the software publisher and the user. It spells out the terms and conditions for using that software. For instance, it might state that the user can only install the software on one computer for personal use — a fairly common stipulation. However, it might also say that by using the software the user agrees to third-party monitoring or to allowing other users to access parts of his/her computer.

Agreeing to a EULA[]

A user can agree to the EULA’s terms in several ways, depending on the publisher and how it distributes its software. Some of the ways a user can “agree” include:

A user can refuse to accept the terms and conditions of the EULA, but then he/she cannot legally use the software.

Why EULAs are Important[]

EULAs can include a number of items a user should seriously consider before installing the software:

  • EULAs are legally binding. Some consumer advocates have challenged the legality of EULAs, especially long agreements clouded in complicated “legalese.” The advocates argue these EULAs are a strategy for discouraging careful review and hiding controversial terms and conditions. However, a number of influential court decisions have upheld the legality of EULAs.
  • EULAs restrict how you can use the software. EULAs often include clauses that limit the number of computers you can load the software on. They sometimes also prohibit reverse engineering for the purpose of creating compatible software. In some cases they prohibit software testing and even publishing the results of this testing.
  • EULAs may force you to agree to certain conditions when using the software. Many software bundles force you to use all bundled components, including software produced by third-party publishers. They may also require you to agree to monitoring of your Internet activity and/or sharing your computer’s resources.
  • EULAs can limit your ability to sue for damages. Most EULAs include a clause that says you cannot sue the publisher for any damages caused by using the software.

What to Look Out For[]

Because EULAs can impose terms and conditions that affect online security and privacy, a user should carefully consider what its willing to accept in exchange for the use of the software. Some EULAs: