Is open source software right for your company?
Open source software (OSS) is a great tool. It’s free. It saves time and money. It’s often secure and reliable. It fosters innovation and collaboration.
However, OSS also comes with important restrictions — and many companies are not fully aware of them.
So while OSS can be an ideal business solution, developing software on your own or taking a traditional licensing route can be the better call. Today, we’ll provide some general information to help you evaluate what may be right for you.
Who uses OSS?
It is important to understand that the use of OSS is not confined to businesses that sell software only. Most companies today provide various types of products and/or services that are controlled or delivered via software as well. If your products or services incorporate OSS — in whole or even in very small part — you should be reading this.
What restrictions are there?
Even though OSS is “free” from a financial perspective, it can come with significant costs. Software is generally protected by various intellectual property (IP) rights, such as copyrights, patents, and sometimes trade secret protection. That’s why you typically must obtain a license to use software owned by others.
Owners of OSS do not relinquish all of their valuable IP rights or place their OSS into the public domain by designating their software as “open.” Instead, they provide license terms for their software, allowing others to freely use it provided they comply with certain restrictions.
What restrictions typically apply?
There are two main licensing philosophies when it comes to OSS. The original OSS movement is governed by a concept called “copyleft.” Under copyleft licenses, you can freely use OSS in your own products and services. However, if you distribute those products or services, you must also openly and freely provide copies of your proprietary source code. The idea is that all software that includes the OSS should also be shared openly and collaboratively.
A close cousin of the copyleft concept is the concept of “patentleft.” Under this theory, the owner of OSS allows you to openly use any patented OSS, but you must also openly license your products or services that utilize the OSS.
The extent to which your own code or products must be shared or licensed under copyleft and patentleft licenses can vary and is often unclear. However, these licensing schemes can place significant restrictions on your end products and services, and should only be used after careful evaluation.
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The second concept is known as “permissive licensing” or “copyfree.” Copyfree licenses are not as restrictive as copyleft. They generally require only that you add certain copyright notices and that you disclose the source code of the OSS and any direct modifications you make to the OSS. You generally do not have to disclose all of your own proprietary source code used in conjunction with the OSS. Thus, copyfree and permissive licenses are generally less restrictive and easier to comply with.
Of course, some licenses are hybrids of the two. The key is understanding that license terms apply and knowing whether you can or want to comply.
Is using OSS a good idea?
If you are using OSS for entirely internal applications — e.g., in applications that are not provided to third parties — OSS is often a great tool. You don’t have to disclose your source code, and IP protection may not be as critical to you. However, if you distribute a product/service with OSS, there are important factors to consider in determining whether the use of OSS aligns with your business needs. Some are:
- Are you willing to disclose your own proprietary source code?
- Do you want to protect the IP rights in your products/services?
- Do you provide your customers with warranties (OSS is often “as-is”)?
- Do you intend to ultimately sell your product/services/business to a third party, who may require representations and warranties as to the software and use of OSS?
- Do you have the resources to develop an OSS compliance strategy and program?
Using OSS is an important business decision that will vary from company to company and product to product.
Tips for compliance
If you are using OSS, be sure you understand and are in compliance with the license terms. Develop a tracking and monitoring strategy so you can make appropriate representations and warranties on your own products/services. Ensure that applicable licenses do not conflict, and if needed, obtain a traditional license. Work closely with your legal team to ensure that your licensing strategy is low-risk and ideal for you.
Melinda Giftos is an attorney with the law firm of Whyte Hirschboeck Dudek S.C., practicing in the areas of intellectual property and technology law. She can be reached at 608-234-6076 or mgiftos@whdlaw.com.
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