What exactly makes an application run on your computer, and why do some programs cost money while others are free? This chapter explains the three main categories of software, how they get installed onto a device, and the legal rules (licensing) that govern their use. Understanding these fundamentals is critical for the FC0-U71 exam because it tests your ability to distinguish between system and application software, describe installation methods, and identify different licensing models.
Jump to a section
A simple way to picture Software Types, Installation, and Licensing
A kitchen has two distinct ways to produce a meal. The first method involves buying every raw ingredient separately: flour, eggs, butter, sugar, vanilla extract, and baking powder from different shelves, measuring them precisely, mixing them in the correct order, and baking them in a preheated oven. The second method is buying a boxed cake mix. The box already has the dry ingredients blended in the right proportions; you just add oil, water, and an egg, stir it, and put it in the oven. The first method represents open-source software where you compile (cook) the program from its raw source code (the individual ingredients). The second method represents proprietary, compiled software that is ready to run after a simple installation (just add a few items from your system).
A third scenario is the pre-made, fully decorated birthday cake bought from a bakery. You do not bake anything; you simply pick it up and put it on the table. This represents Software as a Service (SaaS): the software is fully finished, hosted, and maintained by the provider; you only access it. A fourth scenario is hiring a private chef to cook a meal in your kitchen. The chef uses your equipment and follows your dietary preferences, but you do not need to know how to cook. This represents Platform as a Service (PaaS): the platform (the kitchen) is provided, and you just manage your application (the meal).
At its simplest, software is a set of instructions that tells a computer what to do. It is the opposite of hardware, which is the physical parts you can touch like the monitor, keyboard, and hard drive. In computing, software is broadly divided into two main categories: operating system software and application software.
An operating system (OS) is the master manager of the computer. It controls all the hardware resources, runs other programs, and provides a user interface. Examples include Microsoft Windows, macOS, and Linux. Without an OS, a computer is just a collection of inert electronic components. The OS handles tasks like managing memory, scheduling processor time, and organising files on the disk.
Application software is any program designed to perform a specific task for the user. This includes word processors like Microsoft Word, web browsers like Google Chrome, games, and accounting programs. These rely entirely on the operating system to run. When you double-click a game icon, you are telling the OS to load that application into memory and execute it using the CPU.
A third category is utility software. This is a specialised type of system software that helps maintain, tune, and protect the computer. Antivirus programs, disk defragmenters, backup tools, and file compression utilities all fall under this heading. They are often included with the OS but can also be third-party tools.
Software can also be classified by how it is developed and distributed.
- Proprietary software: The source code (the human-readable instructions) is kept secret by the company that created it. You buy a licence to use the executable version, but you cannot modify it. Examples include Microsoft Office and Adobe Photoshop. - Open-source software: The source code is made publicly available. Anyone can view, modify, and redistribute it, often under a licence like the GNU General Public License (GPL). Examples include LibreOffice and the Linux operating system. - Freeware: Software that is free to use but the source code is usually not available. The author retains copyright but allows free use. Skype (early versions) and Adobe Acrobat Reader are examples. - Shareware: Distributed for free on a trial basis. You might be allowed to use the full version for 30 days, after which you are expected to pay. Often, features are locked until you purchase a licence. - Commercial software: Developed specifically for sale or licensing for profit. Most proprietary software is commercial.
Installation is the process of copying software from a distribution medium (a CD, a download, a USB drive) onto the computer's hard drive and configuring it to work with the OS. The installation process typically involves several stages. First, the installer checks the system meets the minimum requirements (hardware compatibility, disk space, OS version). Second, it copies the necessary files to the designated folders (usually Program Files on Windows or Applications on macOS). Third, it writes configuration settings to the system registry (on Windows) or preference files (on macOS). Fourth, it may add shortcuts to the Start Menu or Desktop. Finally, the software needs to be activated, which verifies that the product key is legitimate.
The installation method varies: - Local installation: the software is physically present on the device's hard drive. It runs using the device's own processor and memory. - Portable application: does not require installation. You can run it directly from a USB drive; it does not write to the registry or Program Files. Cloud-based installation: the software runs on a remote server and is accessed via a web browser. There is no local installation of the core program, though you may install a small client app.
Licensing is the legal contract between the software creator and the user. It defines how the software can be used. The most common types are: - Single-user licence: allows installation on one device for one user. - Volume licence: purchased by organisations to install on many devices, often at a reduced per-unit cost. - Open-source licence: grants the right to use, modify, and redistribute the software, often with the condition that derivative works also remain open-source. - Subscription licence: you pay a recurring fee (monthly or yearly) to use the software. Microsoft 365 and Adobe Creative Cloud use this model. - Perpetual licence: you pay once and can use that version of the software indefinitely. Upgrades may require an additional fee.
Understanding these distinctions helps you choose the right tool for a job, comply with legal requirements, and avoid costly licensing violations. The FC0-U71 exam expects you to know not just the names of these categories but also their practical implications.
Determine the software category needed
Before installation, identify whether you need system software (e.g., an OS or a driver), application software (e.g., a browser or a game), or utility software (e.g., an antivirus). This determines compatibility and installation method.
Check system requirements
Every program specifies minimum hardware (CPU speed, RAM, disk space) and OS version. Skipping this step can lead to a failed installation or poor performance. The FC0-U71 exam tests your understanding of why this check is essential.
Download or obtain the installer
The installer is a specialised executable file (e.g., .exe on Windows, .dmg on macOS) that manages the installation process. It may come from an official website, a CD, or a network share. Always verify the source to avoid malware.
Run the installer and accept the EULA
Double-clicking the installer launches the setup wizard. You must read and accept the End User License Agreement (EULA) to proceed. The EULA defines your rights and restrictions, such as how many devices you can install the software on.
Choose installation options
The installer often offers a 'default' or 'custom' installation. A default installation is simpler and uses the recommended settings. A custom installation lets you choose the destination folder, which components to install, and whether to create desktop shortcuts.
Complete the installation and activate the software
After copying files and writing registry entries (on Windows), the installer may prompt you to restart the computer. The final step is activation: entering a product key that verifies your licence with the publisher's activation server. Activation prevents using the same key on multiple unauthorised devices.
Verify the installation and apply updates
Once installed, launch the software to confirm it works correctly. Then check for updates, which often fix bugs and security vulnerabilities. Setting up automatic updates ensures the software stays current without manual effort.
Imagine you are an IT support technician for a medium-sized company called GreenLeaf Marketing. The company has fifty employees who need to create documents, send emails, and manage a customer database. Your job is to ensure everyone has the correct software installed and properly licensed.
The first task is selecting the operating system. The company currently uses Windows 11 Pro on all desktops. You purchase a volume licence for Windows from a Microsoft partner, which allows you to install the same OS on all fifty machines without needing fifty separate product keys. You use a deployment tool to push the OS image to each new computer, saving hours of manual installation.
Next, you need productivity software. The marketing team uses a mix of proprietary and open-source tools. The accountants require Microsoft Excel for its advanced financial functions, so you purchase Microsoft 365 Business subscriptions for them. For the creative team, you provide Adobe Creative Cloud subscriptions. However, the customer service team only needs basic word processing and spreadsheets. You install LibreOffice, an open-source office suite, on their machines. This saves the company money while still meeting their needs.
The legal department reminds you that all software must be licensed. You audit the existing installations. You discover that three employees have installed a free version of a project management tool that is actually a proprietary commercial product used beyond its free tier limit. This is a licensing violation that could expose the company to fines. You immediately remove the non-compliant software and replace it with the properly licensed version.
You also need to manage updates. For Windows, you configure Windows Update to install security patches automatically. For the Adobe suite, you set up automatic updates through the Creative Cloud desktop app. For LibreOffice, you periodically check for new versions and manually update the installations. You use a centralised management tool to see which computers are missing updates.
One employee requests a portable application for a disk-cleaning utility. You download the portable version of CCleaner and copy it to a shared network drive. The employee runs it directly without installation, which makes it convenient but also means it leaves no traces on the local machine. You note that portable applications are useful for troubleshooting but do not have the same automatic update capabilities.
Finally, you consider a move to cloud-based software to reduce local maintenance. The company decides to migrate email to Microsoft 365 Exchange Online. Instead of maintaining a local mail server, all email processing happens in Microsoft's data centres. Employees access their mail through a web browser or the Outlook desktop app, which is installed locally but syncs with the cloud. This reduces the work you must do to maintain the email system. Each of these decisions involves understanding software types, installation methods, and licensing models — exactly the knowledge the FC0-U71 exam tests.
The FC0-U71 exam tests your understanding of software types, installation, and licensing in several distinct ways. You will encounter multiple-choice questions that ask you to identify the correct category for a given scenario or definition.
Here are the specific concepts you must memorise: - System software vs. application software: The exam loves to provide a list of programs and ask which is system software (e.g., OS, device driver, utility) versus application software (e.g., browser, word processor, game). The trap is that some utilities, like a firewall, are system software, not applications. - Proprietary vs. open-source: You will be given descriptions of licensing models. A question might say, 'A developer wants to view and modify the source code of a program and then share their changes. Which licence must the original program have?' The correct answer is open-source. The trap is that freeware is free to use but does not allow source code access. - Licensing models: You must know the differences between single-user, volume, subscription, and perpetual licences. A typical question: 'A company has 200 employees but wants to buy software for 50 users at a lower per-user cost. Which licence type should they purchase?' Answer: volume licence. The trap is that a subscription licence would also be recurring but does not inherently provide a per-unit discount for volume. - Installation methods: The exam asks about local installation, portable applications, and cloud-based software. A question might say, 'Which type of software runs from a USB drive without being installed on the hard drive?' Answer: portable application. The trap is that cloud-based software also does not require installation on the local computer, but it runs from a server, not from a USB drive. - End User License Agreement (EULA): You will be asked what a EULA is and what it contains. The exam expects you to know that the EULA is a legal contract between the user and the developer that specifies the permitted uses of the software. The exam sets traps by using similar-sounding terms. For example, 'freeware' and 'open-source' are both free, but the distinguishing factor is source code access. Another trap is confusing 'system software' with 'application software' when the program is a utility like a disk defragmenter. It is system software because it helps the OS manage hardware, not because it is a user-facing tool. You should also be prepared for questions about activation versus installation. Activation is the process of verifying a product key, usually online. The exam might ask, 'What prevents a user from installing the same copy of software on multiple computers?' Answer: product activation limits installation to one machine per licence (unless it is a volume licence). Finally, the exam tests your knowledge of Software as a Service (SaaS). A question might say, 'An employee can access a customer relationship management (CRM) tool through a web browser without installing any software on their desktop. This is an example of which service model?' Answer: SaaS. The trap is that you might think of cloud computing in general, but the specific model is SaaS.
System software manages hardware and provides a platform for applications, while application software performs specific user tasks like word processing or web browsing.
Open-source software grants access to the source code and allows modification, whereas proprietary software keeps the source code hidden and restricts modification.
A volume licence allows an organisation to install software on multiple devices at a reduced per-unit cost compared to buying individual single-user licences.
A perpetual licence lets you use a specific version of software indefinitely, but a subscription licence requires ongoing payments and typically provides continuous updates and support.
Portable applications run directly from removable media without installation, while cloud-based applications run on remote servers and are accessed through a browser.
The End User License Agreement (EULA) is a legally binding contract that defines exactly how the software may be used, including restrictions on copying and redistribution.
These come up on the exam all the time. Here's how to tell them apart.
System Software
Manages hardware and system resources directly
Provides a platform for other software to run
Includes OS, device drivers, and utilities
Application Software
Performs specific tasks for the user
Uses the system software to access hardware
Includes word processors, browsers, and games
Open-Source Licence
Source code is publicly available for modification
Often free but can be sold; redistribution allowed
Examples: GNU GPL, MIT Licence
Proprietary Licence
Source code is kept secret by the developer
User buys a licence to use it, cannot modify
Examples: Microsoft Windows, Adobe Photoshop
Perpetual Licence
One-time payment grants indefinite use of that version
Upgrades may cost extra
Owner retains access even if payment stops
Subscription Licence
Recurring fee (monthly/yearly) for ongoing access
Includes updates and support during subscription
Access ends if payments are not maintained
Portable Application
Runs from a removable drive; no local installation
Uses the local computer's CPU and RAM
Configurations saved to the portable drive
Cloud-Based Application (SaaS)
Runs on a remote server; accessed via browser
Local computer only displays output
Data stored in the cloud, not on the device
Freeware
Free to use indefinitely with no payment required
Source code is not provided
Developer retains all rights
Shareware
Free trial for a limited time or with limited features
Expects user to pay for full version
Often stops working or locks features after trial
Mistake
Open-source software is always free of cost and has no licensing restrictions.
Correct
Open-source software is free in terms of freedom (access to source code), but it can still be sold commercially and is always governed by a licence (e.g., GPL) that imposes conditions on redistribution and modification.
Beginners equate 'open-source' with 'free as in beer' (no cost) and assume there are no rules, but open-source licences are legally enforceable and often require derivative works to also be open-source.
Mistake
A portable application is the same as a cloud-based application because neither requires installation on the local hard drive.
Correct
A portable application runs from a removable device (like a USB drive) using the local computer's OS and hardware. A cloud-based application runs on a remote server and is accessed via a browser; the local device only displays the interface.
Both eliminate the traditional installation process, so beginners conflate them. The key difference is where the code executes: locally for portable, remotely for cloud.
Mistake
If you buy a perpetual licence for software, you own the software itself.
Correct
A perpetual licence grants you the right to use a specific version of the software indefinitely, but the software's copyright remains with the developer. You do not own the software; you own a licence to use it.
The word 'perpetual' sounds like 'permanent ownership', but software licensing always preserves the developer's intellectual property rights over the code.
Mistake
Shareware and freeware are the same thing because both are available at no initial cost.
Correct
Freeware is free to use indefinitely with no payment required (but source code is not provided). Shareware is a trial version that either expires after a period or has limited features, expecting you to pay for the full version.
Both are distributed without upfront payment, so beginners think they are identical. The distinction is the intent: freeware is meant to stay free, while shareware is a marketing tactic for paid software.
Mistake
Utility software is a type of application software because you interact with it directly.
Correct
Utility software is actually a subcategory of system software. Its primary purpose is to help manage, maintain, and tune the computer's hardware and OS, not to perform a user's specific job task like writing a letter or browsing the web.
Because utilities often have a graphical user interface (GUI) that you can click on, it is easy to mistake them for applications. However, their function aligns with system-level operations (e.g., disk cleanup, antivirus scanning).
Mistake
Software installation always requires administrative privileges on the computer.
Correct
Many modern applications can be installed without admin rights, especially portable apps and some per-user installations. However, software that needs to modify system files, install drivers, or change settings for all users typically requires admin privileges.
Beginners often think all software needs full admin access because they have experienced prompts to 'allow changes'. However, developers can design apps to run without admin rights if they only write to the user's profile folder.
Reveal each answer, then mark whether you got it right. Score 60%+ to unlock the next chapter.
A software licence is the legal contract (the EULA) that defines how you can use the software. A product key is a unique alphanumeric code used during activation to verify that the licence is legitimate and that the installation is authorised.
It depends on the licence type. A single-user licence typically allows installation on one computer. A volume licence or a family pack licence might allow multiple installations. Always read the EULA to be sure.
If you have a perpetual licence, you still own the right to use the software. You may be able to download the installer from the publisher's website using your product key. Many publishers offer digital replacements for lost media.
Yes, but with caution. Open-source software is reviewed by the community, which can make it very secure. However, you must ensure you comply with the specific open-source licence (e.g., GPL, MIT) and that the software is actively maintained for security updates.
A regular installed app copies files to the system directory and writes configuration to the registry (on Windows). A portable app is self-contained in one folder and runs from a USB drive without making any changes to the host computer's system settings.
Installing software often requires access to protected system areas like the Program Files folder or the Windows Registry. The administrator permission prompt is a security feature that prevents unauthorised software from making system-level changes.
SaaS is software that is hosted on the provider's servers and accessed via a web browser. You do not install the core application on your device. Installed software runs locally on your computer. SaaS examples include Google Workspace and Salesforce.
You've finished Software Types, Installation, and Licensing. Continue through the FC0-U71 study guide to build a complete picture of the exam.
Done with this chapter?