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In the last question I asked, I found out that open-source licenses are always letting people use your code/product commercially. This means that they can technically sell the product.

Does this mean that I can also sell my product? As an example, if I write a web application, can I actively sell subscriptions for a web version that I provided? but also letting people have the code and use it anyway they want (running it locally or on their own server).

This doesn't mean I am no longer "open-source" right?

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  • Yes, you can sell Open Source software, you don't even need to be the author. And the people who buy it from you can turn around and sell it. Why would people buy what they can get for free? We call it "bottled water" for a reason. Commented May 12, 2024 at 1:00
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    Do yourself a favor, and read the license(s) before you distribute any software containing components that other authors wrote. The license is the authoritative source of information about what the author does or does not permit you to do with a given software package. Commented May 12, 2024 at 17:46
  • This is not very hard to answer with a little research. Indeed "free as in freedom, not as in beer" is so common a slogan to be almost a meme. For an explicit source, see e.g. gnu.org/philosophy/free-sw.en.html#selling Commented May 13, 2024 at 14:08

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Yes, it is entirely legal to make money with open-source software.

You are allowed to sell copies of open-source software, but that is not likely to create a sustainable business, because each customer also gets the right to sell copies and to do that at a lower price.

For web-based software, you can also sell subscriptions. This can be a viable business case, even if your software is freely available to potential competitors. Your added value can lie in the availability and connection speed of your servers.

What some licences forbid is that you charge extra for providing the source code to people who already obtained a binary version of the software.

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    Anyway, keep in mind that the license requirements don't apply to the author. If you own the copyright of the software, you can publish it under as many licenses as you want, including open and closed licenses. Other people are bound to the terms of the license they obtained the software with, but you aren't. Commented May 11, 2024 at 23:02
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    "but that is not likely to create a sustainable business" Except for Redhat, HashiCorp, GitLab, Docker, Mozilla, JetBrains, MariaDB, Acquia, and so on. Admittedly, they make a lot of money selling support, services, and products based on their free offerings. People buy bottled tap water. Commented May 12, 2024 at 0:57
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    @Schwern, the business model of those companies is not based on selling copies of the software. Selling copies is the non-viable business model with open-source software. Commented May 12, 2024 at 6:17
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    @ojdo that is more normally referred to as the "open core" model, and is subtly different from simply selling open-source software, though definitely related. Commented May 12, 2024 at 12:36
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    @KidA If you are the sole author, you can do whatever you want with your work, including publishing it under different licenses. If you are not the sole author or your work includes parts from a third part (that is, it's a derivative work of someone else's work), you are bound to the licenses under which you got the parts from others. Commented May 19, 2024 at 12:28
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It should be pointed out that there are multitude of open source licenses, each with their own pros and cons. One major difference between different licenses is what additional conditions that the license allows someone else to add, taking two examples:

GPL

For the most part ensures that any derived works will remain GPL'ed. NAL - not qualified to identify potential exceptions.

BSD 3 Clause License

Adds minimal restrictions to derived works (basically they must include a copy of the license), however the author of a derived work is free to close the source and sell it as a commercial product.

For clarity you can sell copies of a GPL licensed work, but you are effectively charging for the act of copying, meaning you can't charge a reoccurring license fee every year - for the same unmodified software.

You could create a new version / bug fix and charge for copying that or even create a subscription that allows unlimited downloads of future fixes, but the crux of the fee is that you are charging for distribution, not licensing usage of the software.

This means that if you list the software on your site for $20 a copy (binary + source) I could pay you $20 then create my own site where I allow people to download the exact same package (binary + source) for $10 a copy - both of us are only charging a fee to copy it.

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    With GPL you can charge whatever you like for binaries and for providing a warranty or passing on maintenance costs, however you must also provide the source (or just patches to a readily obtainable version of the source code). Within your own organisation you can make unlimited changes to a GPL compiler and distribute proprietary binaries compiled by that compiler without any obligation to release the compiler itself. With BSD distribution in binary format only is allowed at a profit which then allows mixing open and proprietary code. Commented May 12, 2024 at 7:20
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Short answer: No, open source licensing does not prevent you from selling a product.

In this example, you'd be selling a service, not a software. The service you'd be selling would be the hosting of the software, and any data the consumer would create/store through your service.

Personally, I'd recommend thinking that one through properly, as you'd be held accountable for customer data and the security needed therein, reasonable availability (read uptime) and a bunch of other things. You'd be subject to so many various laws, including consumer rights laws in any country that is able to access and purchase the service. I.e., even if you're US based, if you make the service available for EU consumers, you'd have to deal with GDPR.

As for the "open source" aspect, there's a few things to unpack. This is technically a "terms of use", a license set by the copyright holder (usually the creator), which you're free to set for the software itself. "Open source" implies that anyone can distribute the code, make modifications or even sell software that includes the code, a definition set by the Open Source Initiative (a US based corporation, not a law-making entity). By itself, the term "open source" means nothing in the sense of defined law, and you're free to set whatever terms you want for whatever software you wish to develop. I.e., if you wish to make the source public for inspection and available for private use (but not commercial), you're not "open source" by OSIs definition.

With that said, publicly available source code (not using an open source/permissive license) is subject to theft and is a different pitfalls with its own legal issues. It's similar to placing a chair and table on your lawn - people can look at it, but they're not allowed to take it to their own lawn.

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There's also a trend of new custom licences, see ElastiSearch, Confluent, Hashicorp etc there's some discussions as to exactly how open source these are as they put some substantial limitations on users - main motive is to head off cloud providers competition offering PaaS versions of their software.

Also see AGPL GNU Affero General Public License, for some history in this space too.

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The GPL rules are: You can charge any amount you want (and that someone is willing to pay) for the software. You can charge your reasonable cost for providing the source code. You are not allowed to charge at all for the license.

Now one problem is that whoever buys the software from you has the same rights. If I buy your software, then selling the software is very little effort for me, so I can undercut you. One way to make profit is to create software that would be used by competitors. Sell it to A who would not want his competitors B, C, D and E have the software. Then sell it to B etc.

Now if you are the sole copyright holder, or if you cooperate with all copyright holders, then you can do whatever you like.

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  • What is a "reasonable cost"? Commented Aug 22, 2024 at 11:22

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