An extended license is a royalty-free license with extras. Although a royalty-free license is very flexible, it still often comes with restrictions. It may restrict how many times you can reproduce a media product, how many people (in the same company for instance) the media product can be used by, and will often restrict resale and redistribution rights. An extended license lets you extend your rights to include many of these.
For instance, an extended license could give you the right to use an image for an unlimited number of printed copies, it could enable you to re-sell the license to someone else, and it could dictate that the original owner of the image must withdraw all other offerings of the image on all other marketplaces.
In fact, normally when you purchase an extended licence for a media product, this media product will be removed from the stock image website's collection. In other words, after you purchase an extended license, nobody else will normally have the opportunity to purchase a license to the product. However, those that purchased a license to the product before you acquired the extended license, still have the right to use it according to their original license.
Needless to say, the cost of an extended license will be significantly higher than the cost of a simple royalty-free license.
When you purchase an extended license, you still do not own the image nor do you own the copyright to the image. You only own a certain right to it.
In the case of an extended license, your rights are more comprehensive and inclusive than the rights you normally have with royalty-free or rights-managed licenses. An extended license still prohibits use in any pornographic, illegal or criminal situation, as well as defamatory or morally questionable use. The same also goes for a royalty-free or rights-managed license.