End-user license agreement (EULA)

What is EULA?

EULA is short for End-User License Agreement, and it represents a legal contract between a software manufacturer and the customer – end-user of the software. EULA generally states the user’s rights and restrictions when it comes to the software use. EULA might also include a clause about the degree of liability applied to the software manufacturer in case the software causes damage to the use’s device or data. Therefore, EULA includes usually standard clauses and procedures regarding the (im)proper software use and/or distribution. Depending on the software manufacturer EULAs and their content might differ.

Microsoft’s EULA

Microsoft’s EULA is a set of license terms representing an agreement between Microsoft and the buyer of the company’s software and/or services. Users of the software automatically accept EULA’s terms by simply using the software. EULA might differ from one software to another, however, in principle, the contract includes both rights and restrictions connected to using the respective Microsoft software. The only exception to Microsoft's EULA is when local rules differ and overrule it.

Usually in EULA, one can find legal clauses such as the proper software’s distribution and transfer requirements. All Microsoft software must not be separated or transferred when incomplete. EULA can be found on the user’s local disk in the folder Windows, then the subfolder System32. EULA is added at the time of the software installation as a Rich Text Document file. Another way to find the respective EULA for an already installed Microsoft software is with the combination “Win + R”. The command winver opens a dialog window with Microsoft Software License Terms as a hyperlink. Lastly, one can also find the EULA for their software through the general settings and under About - “Read the Microsoft Software License Terms”.

Is EULA legally valid?

EULA’s legal validity has been questioned on multiple occasions. The main reason for the public’s doubt in its validity is the way it is presented to users. Since EULA contains general terms and conditions about the use of the software, it is only valid before or at the time of the software purchase. Any EULAs that are made available to the buyers after the purchase, can be regarded as invalid regarding private users.

Criticism of EULA

EULA is often criticized because it has been statistically proven that customers usually do not read the end-user license agreements as they are too long. Additionally, the terminology used in the agreement is more often than not difficult to comprehend and sometimes might be even misleading. Some extreme examples of content in EULA could be the restriction of clients to sure the software manufacturer in court or clauses demanding users to provide data to third party (usually without notifying the customer). Because of these aspects, EULA has faced criticism over the years.