Commercial Software - Free and Open-source Software

Free and Open-source Software

While less common than commercial proprietary software, free and open-source software may also be commercial software. This is a fact that the Free Software Foundation emphasizes, and is the basis of the Open Source Initiative.

Under the free software business model, free software vendors may charge a fee for distribution and offer pay support and software customization services. Proprietary software uses a different business model, where a customer of the proprietary software pays a fee for a license to use the software. This license may grant the customer the ability to configure some or no parts of the software themselves. Often some level of support is included in the purchase of proprietary software, but additional support services (especially for enterprise applications) are usually available for an additional fee. Some proprietary software vendors will also customize software for a fee.

Free software is generally available at no cost and can result in permanently lower costs compared to proprietary software. With free software, businesses can fit software to their specific needs by changing the software themselves or by hiring programmers to modify it for them. Free software often has no warranty, and more importantly, generally does not assign legal liability to anyone. However, warranties are permitted between any two parties upon the condition of the software and its usage. Such an agreement is made separately from the free software license.

A report by Standish Group says that adoption of open source has caused a drop in revenue to the proprietary software industry by about $60 billion per year.