The term open source refers to the license applied to a software package, library, or product. Traditionally, commercial software has been produced in two different ways:
- proprietary software, in which a single organization develops a software package, owns its copyright (or, in some cases, patent), and licenses its use. Usage licenses are nearly always related to payment.
- open source software is the opposite in many ways. The software itself is developed in collaboration by many people and/or organizations, often managed by a single project or foundation – many people contribute to the package. Copyright is either contributed to a central foundation with authorship maintained as a footnote, or it can be maintained individually by the contributors, as long as the license for the package is consistent or compatible with the overall package. The precompiled source code is made publicly available, hence the term “open source”.
Another way to understand the difference is in the financial model. If the software itself represents inherent value, proprietary software operates on a scarcity model – that value is recognized by preventing people from sharing the value openly. Open source operates on an abundance model, by which anyone can read the code, contribute their own changes, and use and change the software, creating an abundance of both value and opportunity. The value of the whole is greater than the sum of its parts.
This difference is not simply philosophical. The recoverable value of open source far exceeds that of the proprietary model in nearly every measurement. This has been recognized by every major industry on the globe, many of which have been or are currently being transformed by open source. In addition, open source has opened up entirely new markets and created vast opportunities.