Difference between revisions of "Dual Licensing"

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Revision as of 23:23, 3 July 2010

An important licensing and business strategy in commercial Open Source Software industry.

= Dual licensing is based on the idea of simultaneous use of both open source and proprietary licenses.

Definition

"The first license is a GPL-like license, which is free but forces users to disclose the source code of any modified version of the original design. The second is a commercial license, which has a fee but allows buyers to conceal the source code of any modified version." (http://www.osbr.ca/ojs/index.php/osbr/article/view/570/523)


Description

"With a dual-licensing approach, the company is protected by a GPL (or similar) license, because both competitors and potential customers who wish to embed/link with the GPL software must also GPL their own code. Since most competitors/customers don’t wish to do so, they are willing instead to pay for a commercial license. This simple yet subtle point is at the heart of the success of nearly every commercial open source organization." (http://robertogaloppini.net/2007/06/02/open-source-firms-enterprisedb-business-model/)

Adam Beberg:

"One way is to release everything under both a traditional commercial use and an open source license. Users who wish to use the code commercially can provide revenue while providing the benefits of open source to noncommercial and academic users. The other way dual licensing is done is to lead with the current version under a commercial license, and follow later releasing old, obsolete versions under an open source license. Again many paying users will need the most current version; others can wait for the version to be made open source. Dual licensing seems to be more acceptable to the open source community since it has been done for a longer time." (http://www.softpanorama.org/OSS/webliography.shtml)


Discussion

Valimaki:

"Dual licensing mixes several of the introduced generic software business models. Duality means that both the free software distribution mechanism and traditional software product business are combined. There is technically only one core product but two licenses: one for free distribution and free use and another for other (proprietary).

Dual licensing model differs from pure free software model in several ways. First, the development community does not have development power to start competing products (forks). Copyright and control of the core product development is held in one hand, the original developer. The ability to license the product with other terms than open source requires full ownership of all rights to the product.

Second, the users of the free license have an option to obtain a proprietary license. If a software product with an inheriting copyleft clause – as for example term 2b) in the GNU GPL License (GNU, 1991) – is embedded to become a part of another product then the combined product should be distributed for free. A proprietary license may free the user from this restriction. In this way, third party product businesses become also possible. From the user’s perspective, dual licensing can be described as indiscriminating." (http://opensource.mit.edu/papers/valimaki.pdf)


Example

The EntrepriseDB strategy:

"First, we created a superset of PostgreSQL called EnterpriseDB Advanced Server, and closed-sourced the code. In other words, atop base PostgreSQL, we added deep Oracle-compatibility, dynamic performance tuning, and world-class tools, including replication, debuggers, browsers, and more. Then we closed-sourced the whole package. In this manner, we have crisply defined a set of value-added features for which we charge, much like SugarCRM’s professional edition. If you want the free-and-open-source version version of the software, though, it’s easily available…and it’s called PostgreSQL.

The second — and equally important — part of our business strategy is to be an excellent citizen in the PostgreSQL open source community. We are building a successful company on the shoulders of one of the world’s most successful open source projects, and we have a responsibility to give back to that community to the maximum extent possible, while still protecting our ability to generate revenue. In addition to our ethical responsibility, we also “do well by doing good” because we promote the wider spread of PostgreSQL, the world’s most advanced and enterprise-class open source database (albeit only the second most popular)." (http://robertogaloppini.net/2007/06/02/open-source-firms-enterprisedb-business-model/)


More Information

  1. Open Licenses
  2. Research paper: Dual Licensing in Open Source Software Markets. Stefano Comino and Fabio M. Manenti
  3. Välimäki, Mikko, 2003. “Dual Licensing in Open Source Software Industry,” Systemes

d’Information et Management. URL: http://opensource.mit.edu/papers/valimaki.pdf