This article is intended for busy business people with interest in open source. I have seen that there are misconceptions on open source licensing, copyright and trademark. I am not a lawyer, so this is not legal advise. This article should give you a good overview on this topic.
Open source license: What you can do; how you can redistribute the software.
Copyright: Who owns the intellectual property of the software.
Trademark: Who is allowed to use the brand name for commercial purposes.
Open source license:
There are many open source licenses. The one most widely used is the General Public License (GPL), which we cover in this article. The GPL governs the distribution of the software, not its use. Commercial licenses on the other hand talk about the use of the software: Among other restrictions, you must not modify, reverse engineer, or copy the software. In contrast, you can use GPLed software you download in whatever form you wish, such as copying it many times, and modifying it - you can even mix it with proprietary software. You can keep the changes to yourself, e.g. you are not required to redistribute the software.
There are however some rules if you decide to redistribute derivative work, e.g. software you downloaded and modified. When you redistribute the changes you made, including contributing back your changes to the open source project upsteam, you are required to attach the GPL to the modified code. That is, you can't switch to a different license unless you own the intellectual property (IP) of the whole GPLed software package (we get to IP and copyright in a bit). Also, the source code must be made available, e.g. you can't redistribute just the binaries.
GPLed software is not necessarily free as in beer; you can sell GPLed software. Red Hat creates a very stable and secure Linux distribution called Red Hat Enterprise Linux (RHEL), and companies are willing to pay for it.
It is actually possible to mix proprietary and GPLed software - the question is how loose or tight the relationship between the two is. I am not a lawyer, and AFAIK it has never been tested in court, but the consensus is as follows: If extensions need to be compiled together with GPLed software it is considered a tight relationship, e.g. extensions to GPLed code must be GPLed if distributed. On the hand, software that has a loose relationship can have mixed licenses, such as software with dynamic linking or executed via an interpreter. In TWiki's case, core code and plugins fall under the GPL because there is a tight relationship between Perl core code and Perl plugins. On the other hand, TWiki applications written in the TWiki Markup Language (TML) are interpreted by the TWiki engine and plugins. Because there is a loose relationship between TWiki engine and TML, the TWiki application developer can chose the license to be commercial or open source.
On to the copyright and intellectual property question. A person or a company contributing source back upstream to the open source project owns the IP of the new code. With that, GPLed software tends to have many copyright holders - the TWiki projects has hundreds, Linux has thousands.
Now, if a company wants to change the license it has to get the permission of each and every copyright holder to do so. In the case of Linux it is highly unlikely that this is possible. On the other hand, a company who owns all the IP of GPLed software from the beginning can attach any license they chose. MySQL, now Oracle, follows that strategy. They create the IP and in some cases acquire the IP. When a third party wants to contribute code back to the MySQL project, and MySQL is interested in that code, MySQL purchases the IP of that code. In some cases they hired the person who created the IP. They are very careful that no code owned by someone else is ever mixed with code they maintain.
Which brings us to dual licensing: Because the company owns all the IP, it is free to distribute exactly the same software under the GPL and a commercial license. If a customer wants to embed MySQL into their proprietary code and resell that, they would be required to attach the GPL to their code. To avoid open sourcing their proprietary code they can get the exact same MySQL software from Oracle under a commercial license.
Let's get back to the Red Hat Enterprise Linux distribution to understand the trademark question. You may ask, couldn't someone who purchased RHEL simply redistribute the OS for free or a fee? This should be possible based on the GPL, right? Yes and no. Here is the criteria:
Is the software pure GPL, or is it mixed with commercial license?
Who has the commercial rights to the brand?
RHEL is apparently purely open source, e.g. it is not mixed with proprietary code. However, the RHEL is shipped in binary form, and has the accompanying exclusive legal right to pass along the ISV certifications associated with the RHEL binary distribution. If you request the source code from Red Hat you have the right to redistribute it, but there is still the trademark question.
Red Hat has a registered trademark on the name Red Hat, e.g. they own the brand. The entity who owns the trademark has the legal rights to the commercial use of the brand. The owner can license the trademark so that others can use the brand for commercial purposes. Nobody can sell Harley-Davidson merchandize without permission from Harley-Davidson Financial Services. A trademark owner has the duty to defend a trademark - if a trademark is not defended it becomes common good, e.g. the trademark is lost. We had a case in 2010 where Seibert Media stated in Google ads that "TWiki, the grandfather of all enterprise wiki systems is no longer maintained" while promoting their own fork of TWiki. This was a clear violation of German laws on comparative ads and trademark laws, and we had to defend it.
So, is there a free (as in beer) distribution of RHEL? Yes, but under a different name: CentOS is a rebranded RHEL in binary form. CentOS is a very popular Linux distribution used by many ISPs; it is as stable and as secure as RHEL. Is the CentOS distribution legal? Absolutely, based on GPL, copyright and trademark. Red Hat's trademark is not infringed, so Red Hat has no need to defend it. Is it ethical? Questionable. Does Red Hat lose business? Possibly. On the other hand, companies currently using CentOS who want to get support can easily switch the RHEL. So the large footprint of CentOS can be a lead-gen for Red Hat.
I hope this overview clarifies some questions you may have on open source license, copyright/IP, and trademark/brand. Please let me know if you see any inaccuracies or omissions; I am looking forward to feedback.
-- PeterThoeny, founder of TWiki.org
Note: Red Hat, CentOS, MySQL, Oracle and other names mentioned may be the trademark or service mark of their respective owners.
We also need to remember things like contributor agreements and non-source code content licenses (like CC).
-- Christopher Allen - 2012-07-19 - via Facebook
Yes, the Creative Commons (CC) is great for text and photos! For my photos I use CC BY 3.0.
-- Peter Thoeny - 2012-07-20 - via Facebook
How do you handle things like contributor agreements? An open source license a team of people can typically agree on, but then when there is no standard for contributor agreements, they decide not to participate.
-- Christopher Allen - 2012-07-20 - via Facebook
On twiki.org we introduced a code of conduct in 2008, which acts as a contributor agreement. Everybody who wants to participate should adhere to the code of conduct. Initially we just had a mission statement defining the technical direction of the project - we learned that this was not enough to avoid conflicts among contributors. We introduced the code of conduct primarily to resolve conflicts, and as a result people who did not agree left the project in 2008.
-- Peter Thoeny - 2012-07-20 - via Facebook
Thank you for the article. But why would CentOS be ethically questionable, even if they provided no value whatsoever to RedHat? I think RedHat themselves would disagree with you.
The GPL includes the right to copy the code, and that includes the right to fork it, repackage it, keep updating from the upstream, etc. The free software philosophy that the GPL is based on strongly asserts that this freedom is a good thing. And RedHat makes use of this for most of the code they include in RHEL (some of which was developed by other commercial entities).
RedHat of course also writes their own code and adds it to the RHEL distribution. And they release this code under the GPL too. One reason is of course that this makes their user base happy in a way that a proprietary license would not. But another reason, it seems to me, is that they genuinely believe in the FOSS model as a way of building quality software. They seem perfectly happy that some of their additions get reused by competitors such as SUSE, while they get to do the same in return.
-- Albert Dvornik - 2012-07-28
Legally OK, but IMHO ethically questionable because CentOS does not (AFAIK) support the open source community upstream (Fedora/Red Hat). I believe open source is about taking and giving back. In TWiki's case, some companies using TWiki contribute(d) back upstream (such as Morgan Stanley, Motorola, Intel, Sun, Oracle, Alcatel), others don't (such as Yahoo, Google). Yes, nobody using GPLed software has to give back, but in spirit of open source it is good to feed the open source contributors; even if done in a self centered way to get a better product faster... So, does CentOS add value upstream? (I love Red Hat & CentOS, have used both.)
-- Peter Thoeny - 2012-07-30
What if I was a hosting company that sold VPS servers and support? As part of my support I install and configure RHEL for the customer. Ignore the part about RHEL not being free. I ask because I am involved in just this sort of situation and the difference is that the software I am redistributing is free. However they claim I am violating their trademark by installing their software. In their words I am "selling their software" which is incorrect. Their software is free open source GPL licensed. Even if I was selling their software that should not matter as long as I don't violate the trademark. Their trademarked free GPL licensed software runs on top of CentOS btw. In case that is a factor.
-- TWiki Guest - 2014-02-17
John Novack aka FredFlint, please do not register with a fake name, I removed your TWiki.org account.
An entity owning a trademark has to defend it, or it will potentially loose it. Infringement test is frequently done with a "confusingly similar" test. So check their trademark to see what is protected and what not. For example, a sausage company called Acme might have a registered trademark on the Acme brand to manufacture, trade and sell sausages. If you use the brand Acme for an accounting software you are not infringing on their brand - there is no similarity in sausages and accounting software. Now, if you want to host GPLed software you need to apply the same similarity test. To work around the registered trademark you might need to rebrand, as CentOS did. I am not a lawyer, so don't consider this legal advise.
-- Peter Thoeny - 2014-02-20