Another solution is to use a licensing technology with a dongle. This is a small device that plugs into USB or another I/O port on the host, and serves as a unique, physical key to activate the software.
A third solution is to provide a license manager. That is, when the software starts up, it queries a server on the network (either on the customer's LAN or else accessed at your company via the internet) that validates that the customer's usage of the software is legitimate. This is a good solution for "concurrent licenses" so customers can install your software on many hosts, but you license it for simultaneous use on a limited number of hosts. FLEXnet Publisher is an example of a license management solution.
The MAC address of the network card is the solution I used last time I worked for a company that licensed software to run on a specific host.
However, I want to offer a caution: if you do this type of licensing, you have to anticipate that it'll become an ongoing administrative chore to track your customers' licenses. Once you have a few hundred customers, you'll be amazed at how frequently you get phone calls with requests to change keys
"We upgraded our server to a gigabit
network adapter, and now the license
won't work because the new adapter has
a different MAC address."
Or else the customers may replace their whole machine, and need an updated license to run your software on the new machine. We got these calls practically every day at the company I worked for.
You also need to trust the customer to stop using your software on the old computer (or network adapter) if you give them a new key. If you couldn't trust them to obey the license in the first place, how can you trust that they'll throw away the old key?
If you don't plan how you're going to support this administrative activity, don't license your product in this way. You'll only inconvenience your good customers, who would have cooperated anyway.
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