What You Need to Know About Open-Source and Proprietary Licenses

A hacker's laptop.

When it comes to using, developing, and promoting software, the numerous licenses that accompany them can be confusing for even expert users. Open-source and proprietary licenses often butt heads. One lets people use software more freely whereas the latter promotes a closed and guarded method of licensing.

In this post, we compare both open and proprietary licenses. We also discuss whether they work well together or the relationship is estranged.

An Introduction to Software Licensing

For the uninitiated, software comes broadly in two different formats. Let’s go over both open source and proprietary (or closed-source) licensing.

Open Source Licensing

Open source is a type of copyright license that lets developers view, modify, and share the source code from a computer program. It’s usually freeware, although premium open-source software is also available.

Usually, the developer will choose a specific open-source license, appropriate for the work. There are many available, such as the GNU General Public License (GPL), the MIT License, or the Mozilla Public License (MPL).

The MIT License website.

Given there are more eyes on the code, there’s the potential for the strength in these numbers to help enforce the license used. What’s more, users will have more of a vested interest in carrying out code reviews, given that they will be the primary customer.

However, open-source software and hardware often comes “as-is,” usually with no guarantee of stability or support. As such, unless there’s a premium tier available for a piece of software, you may have compatibility problems with your system and other software.

Proprietary Licensing

Compared to open-source licenses, proprietary licensing doesn’t have any oversight apart from legal trading laws – in this case, the developer rules of how the software can be used. As such, you’ll often find a fervent “hacking” community around certain pieces of popular software.

A picture from a hacked Game Boy camera.

Almost every proprietary title requires you to accept a long set of Terms and Conditions. Once you accept this legal document, it becomes a binding contract between you and the developer, which means you’re liable for any terms you break.

However, proprietary licensing often provides bug fixes, patches, and support to paying end users. This isn’t always the case, but premium proprietary software has a vested interest from the developer to ensure it works for users. This is because they’re the only ones who can resolve issues.

This also results in problems for users who rely on software that gets abandoned by the developer – often, the licenses remain active.

Comparing Open-Source and Proprietary Licenses

When looking at both open-source and proprietary licensing, there are a few key differences. Let’s take a look at a summary table showing how both licensing models compare.

CostUsually free, sometimes with premium elementsSet by the developer, although it can be free
CopyrightLicensed, credit given to the original developer when modifiedLicensed by the developer only, with the licensee granted the rights to use it
Source Code OwnershipNo ownership rightsThe developer owns the rights
Source Code ModificationsAnyone can modify and repurpose the codeOnly the developer can view and modify the source code

Overall, open-source and proprietary licensing have two different goals in mind. The former values a collaborative development community taking a basic idea further. However, the latter is arguably more focused on protecting usage rights and making profit in the first instance.

Can Open-Source and Proprietary Licenses Work Well Together?

There are numerous examples of open-source and proprietary licensing models meshing well together. For example, popular coding developer JetBrains provides open-source (and free) versions of its proprietary licensed premium software.

The JetBrains website.

However, other companies have embraced open source in a different way. Both Google and Microsoft have created or acquired open-source projects to build a proprietary product. Both Google Chrome and Github are proprietary but sit on top of the Chromium browser and Git respectively.

In contrast, Elastic has rescinded its open-source licensing for Elasticsearch, as they say Amazon has unethically profited from the software. It shows there’s still an ideological difference between the two viewpoints.


In short, open and proprietary licenses will always rub each other the wrong way. However, there can be a system where companies still retain brand rights while letting users study and tweak the code. The benefits to the codebase and user security are of immense benefit to everyone.

We recently took a look at the best open-source software to use in 2021. Are you an open-source advocate, or does proprietary licensing make more sense to you? Let us know in the comments section below!

Tom Rankin
Tom Rankin

Tom Rankin is a quality content writer for WordPress, tech, and small businesses. When he's not putting fingers to keyboard, he can be found taking photographs, writing music, playing computer games, and talking in the third-person.

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