A more thorough explanation:

Licensing is when someone sells permission to use something that is protected by copyright, patent, or trademark. For example, a company may sell a license to use their computer software to another company.

Another example of licensing is when a musician sells the rights to use their music in a movie or TV show. The movie or TV show producer pays for the license to use the music in their production.

These examples illustrate how licensing works. It allows the owner of a protected item to make money by selling permission to use it to others. The person or company buying the license gets legal permission to use the item without fear of being sued for copyright or trademark infringement.