The Differences Between Commercial Software, Freeware, Shareware, Open Source, and the Public Domain

By Martin Medeiros

Commercial or proprietary software is licensed pursuant to a license created by the author. This so called “outbound licensing model” typically grants limited licenses, for a fee, to end users, allowing them to use the software and its associated intellectual property, with limited access to source code. Access to source code is typically granted, if at all, pursuant to a triggering event. For example, the author’s inability to support or service the software and provide fixes is one such trigger.

The commercial construct contrasts with various other licensing models such as “freeware” or “shareware.” This model is a means of software distribution. Freeware and shareware are usually provided in object code form[i] at no fee, typically with the free right to redistribute. These are naked “as is” licenses, and the user does so at their peril.

The licensing scheme whereby software source code[ii] is disclosed, licensed and distributed on specific terms, which require subsequent contributors and distributors to abide by those terms at little or no charge, is the essence of open source.[iii]

“Public domain” software is not a licensing scheme at all. And there is confusion in the judiciary as to its relationship with open source.[iv] The public domain designation indicates that the intellectual property protection has expired, or the software’s intellectual property has been dedicated to the public domain. “Public Domain Software” is software unprotected by copyright.[v] No intellectual property protection exists for public domain software. By contrast, open source licensors retain ownership of their intellectual property, but grant very broad licenses to it, in exchange for relinquishment of liberal commercial rights.

[i] A set of instructions, written in a programming language, that must be translated to machine instructions before the program can be run on a computer. The program which runs on that computer is known as the object code. Newton’s Telecom Dictionary, (20th Ed. CMP) 2004.

[ii] Id..

[iii] “Open source” refers to a “movement” or business model within the software community in which the source code for the software is made publicly available, often pursuant to terms which grant a license free of charge, with the proviso that any redistribution of the source code, New York v. Microsoft, New York v. Microsoft Corp., 224 F.Supp.2d 76D.D.C.,2002).

[iv] E.g “once the programs are freely released into the public domain the creators intend for them to stay free.” Computer Associates Intern., v. Quest Software, Inc., 333 F.Supp.2d 688, 698 (N.D.Ill.,2004); and “Gnutella is open-source software, meaning that the Open source code is either in the public domain or is copyrighted and distributed under an open-source” Metro-Goldwyn-Mayer Studios, Inc. v. Grokster Ltd.,380 F.3d 1154, 1158 (C.A.9 (Cal.),2004).

[v] Graham v. James, 144 F.3d 229 (C.A.2 (N.Y.),1998).