In general people are much more familiar with the concept of licensing when thinking about music and movies. We all know that when we buy an album or movie that we can listen or watch to our hearts content. We can play the music in our cars and on our phones and in our houses but what we can't do is make copies and sell them or play the music at public events. You can watch a movie at home with friends but you can't put it on the tv in the pub.
All of these activities are protected by licensing. If you want to show a movie in the pub you have to get permission of the copyright holder and probably pay a fee for the special licence.
The same applies to my photography. By law I own the copyright of all the images I create. And by law I am entitled to charge a fee for their usage by other people. My licences set out the rules for how my clients can use those images. My licences are generous to my clients while protecting our reputations.
The parts of the licence
The typical parts of a licence cover the following items
My standard license doesn't allow clients to sell the image on to another party like a stock library or advertising agency or other third party. An extended license is available for an additional fee depending on the scope of usage. My image copyright tracking system could cause the awkward situation where I pursue a third party for unapproved use when they turn out to be related to a client. It's always best to ask first.
National or International billboard and print campaigns are not covered by a standard licence.
A client may have employed a third party such as a design agency to handle their website and media or the client may be and agency who is sourcing images on behalf of a client. My standard licence covers this working relationship.