Licensing agreements can be categorized into three primary types:
Exclusive Licensing Agreements
Under an exclusive license, the licensor grants sole rights to the licensee, excluding others from using the intellectual property for the agreed-upon purpose and within a specified territory. These types of licenses can be extremely lucrative since it limits the how the creator/owner of the property can bring it to market.
Non-Exclusive Licensing Agreements
Non-exclusive licenses allow the licensor to grant multiple licenses to different parties simultaneously. This arrangement permits broader distribution of intellectual property but may result in increased competition among licensees.
Sole Licensing Agreements
A sole license falls between exclusive and non-exclusive licenses. It grants the licensee exclusive rights within a specific territory or field while allowing the licensor to retain the ability to exploit the IP in other areas or territories or with other licensees.