Software protection and licensing are important topics for both the independent software vendors and software users. In Grid environments, the use of license protected applications is almost impossible and becomes a challenging task. The reasons are twofold: (i) there are no business models of the independent software vendors for the Grid and (ii) there is no licensing technology suitable for Grid environments. In this paper, the state of the art of license management in software industry as well as the current practice for managing the licenses in Grid computing is presented. The challenges and requirements of managing the software license in Grid environments are identified. Two general models developed in the European projects BEinGRID and SmartLMfor managing the software licenses in Grid computing based on service level agreement (SLA) are presented.