How Licensing Server works?

When customer sends a request to any Licensing Server, actually request will be validated/authenticated by considering two things
1. Token ID (40 characters) / UserID & Password
2. Entitlements (This will have information of customer purchased products, License validity period and each product 'in use' count information)

Suppose customer purchased “XYZ Product” license for 10 desktops, and if customer has installed on 15 machines, in your License Summary tab you can observe that specific agent entry shows in red color (you can observe "IN USE" column in license summary).
If "in use" is more than what you really have then you cannot download updates for your product. This is how we can prevent users from downloaded updates for unauthorized licensing.

How Licensing Server can help issuer?:
1. Track customer usage easily
2. Monitor compliance
3. Reduce security risks
4. Minimize risk of a security audit
5. Reduce costs by paying for only what customer use

Each time you purchase a product, Company will update Customer Company’s record with that purchase allowing your organization to minimize the number of keys.

To Generate a XYZ product Token?
First, customer should see license issuer company, Customer Welcome Kit for information on creating a Customer Support Portal Login, and that it is associated with your company

If already have an Token number? :
If the end-user for the new product is the same, the organization record will have been updated with the new purchase information. The License issuer company back-end will automatically update the customer system or the Local Management Interface with new purchases the next time it contacts Licensing Server.

Hope this info would definitely help everybody who reads this article to some extent, in analyzing your requirement and to move forward.