Open Core Software: Licensing Models and Industry Conflicts
In the modern software landscape, many companies employ a strategy known as open core. This model combines an open-source foundation—the "core"—with proprietary enhancements, allowing companies to offer a free version of their product while charging for enterprise-grade features. While this approach balances community growth with commercial viability, it often creates tension between open-source ideals and corporate profit motives.
How Open Core Works in Practice
The open core model typically manifests in one of two ways: by building a proprietary product on top of an open-source engine, or by offering a "Community Edition" (CE) alongside a paid "Enterprise Edition" (EE). This allows developers to use the basic functionality for free while businesses pay for advanced security, management, or scalability tools.
Common Examples of Open Core and Hybrid Licensing
- Visual Studio Code: Built on open source, but the Microsoft binary includes a proprietary extension store and a End User License Agreement (EULA).
- Google Chrome: Utilizes the open-source Chromium browser and the Blink rendering engine.
- Kafka and Cassandra: Both use the Apache 2.0 license for their cores, while Confluent (for Kafka) and DataStax (for Cassandra) provide proprietary licenses for additional enterprise features.
- MySQL: Employs dual-licensing under a proprietary license and the GNU General Public License (GPL).
- IntelliJ IDEA and GitLab: Both offer a free Community Edition (Apache and MIT-style licenses, respectively) and a paid version with proprietary licensing.
- Neo4j: The Community Edition uses GPLv3, while the Enterprise Edition is proprietary, adding features like hot backups and clustering.
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Specialized Implementations
The open core philosophy extends beyond traditional software. For instance, Seldon Core provides an Apache 2.0 licensed machine learning platform, while Seldon Deploy is sold under a commercial license. In the gaming industry, titles like Doom, Amnesia: The Dark Descent, and Friday Night Funkin have released their source code under open licenses while keeping artistic assets (sound and art) proprietary.
Key Facts
- Open Core blends open-source foundations with proprietary, paid extensions.
- Dual-licensing allows software to be available under both a free (e.g., GPL) and a commercial license.
- Source-available licenses allow users to view the code but restrict how it can be used commercially.
- Forks occur when a community creates a new, independent version of a project following a restrictive license change.
- SSPL (Server Side Public License) is a controversial license designed to prevent cloud providers from offering software as a service without contributing back.
The Conflict Over Cloud Services
Since 2018, a significant shift has occurred as vendors seek to prevent cloud application service providers, such as Amazon Web Services, from integrating their software into paid services without providing adequate compensation or contributions to the original project.
The Rise of the SSPL and BSL
To combat this, some companies moved away from traditional open-source licenses toward source-available licenses. MongoDB transitioned from the AGPL to the Server Side Public License (SSPL). This requires any service incorporating SSPL components to release the source code of the entire service. The Open Source Initiative (OSI) ruled that the SSPL is not a free software license because it discriminates against commercial users, leading distributions like Debian and Fedora to remove MongoDB.
Similarly, HashiCorp switched its products, including Terraform, to the Business Source License (BSL), which prompted the creation of the Linux Foundation-backed fork, OpenTofu.
The Case of Redis
Redis experienced a complex licensing evolution. After initially adding a "Commons Clause" to its Apache License, it moved to the Redis Source Available License. In 2024, it adopted dual-licensing under the SSPL and its own source-available license. By 2025, Redis reinstated a free license (AGPL) to compete with forks like Valkey.
Legal Battles and Ecosystem Tensions
Licensing disputes can escalate into legal warfare. A prominent 2024 conflict emerged between Automattic (sponsor of WordPress) and WP Engine. Matt Mullenweg accused WP Engine of failing to contribute to the ecosystem and diluting the WordPress trademark. This led to Automattic blocking WP Engine from WordPress.org services.
WP Engine responded with a lawsuit for defamation and extortion. In December 2024, a court granted a temporary injunction prohibiting Automattic from interfering with WP Engine's access to the WordPress.org repositories.
| License Type | Core Philosophy | Commercial Restriction | Example |
|---|---|---|---|
| Open Source (Apache/MIT) | Free use, modification, and distribution. | Minimal to none. | GitLab CE |
| Copyleft (GPL/AGPL) | Free, but derivatives must also be free. | Must share source code. | WordPress |
| Source-Available (SSPL/BSL) | Code is viewable, but usage is restricted. | Prevents "as-a-service" sales. | MongoDB |
| Proprietary | Closed source; owned by the vendor. | Full commercial control. | Visual Studio Code Store |
Frequently Asked Questions
What is the difference between open source and source-available?
Open source software must meet the Open Source Definition, which prohibits restrictions on who can use the software or for what purpose. Source-available software allows you to see the code, but the license may forbid using it to provide a competing commercial service.
Why do companies switch from Apache 2.0 to SSPL?
Companies often switch to the Server Side Public License (SSPL) to prevent large cloud providers from taking their free software, hosting it as a paid service, and keeping the profits without contributing back to the original developers.
What happens when a popular project changes its license?
When a project moves to a restrictive license, the community may "fork" the software. This means they take the last open-source version of the code and start a new, independent project, such as OpenTofu forking from Terraform or Valkey forking from Redis.
Can a product be both open source and proprietary?
Yes, through the open core or dual-licensing model. A company can offer a basic version under an open-source license (like Apache 2.0) and a premium version with additional features under a proprietary license.