This is a great little summery of the different types of licenses offered.
Licensing is a very subjective issue, and is typically determined by the user of the music. The choice of licensing a cue can be based on such things as budget, expected use, and available options. How much a client will pay for various licensing is based many factors such as exposure, region, and whether the use is a royalty paying spot. For example, commercials and promos do not pay royalties therefore licensing is much higher. The different types of licenses are: