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Software developers – what you need to know about open source software

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Open source software is software whose source code is made available to the public and whose users are permitted to modify that source code to create new software.  Many products nowadays are based on open source.  Examples include the Linux operating system, Firefox web browser and Openoffice.

There are also a number of software development tools and libraries which are open source.  It is very common for software developers to incorporate these open source tools and libraries into their products.

While a product may be open source, the use of the source code will still be governed by a licence agreement.  Nowadays many software vendors who distribute open source code will, instead of preparing their own licence agreement, apply one of a number of common licence agreements to govern the use of their product.  One example of this is the GNU General Public Licence.

Open source licences contain a number of terms which must be complied with.  These include:

  • “Copyleft” – this requires any adaptations of the open source code to be distributed under the same licence terms
  • Some licences prohibit commercial redistribution
  • Some licences will “pollute” your products.   In certain circumstances, if you incorporate an open source component in your product, some licences may require that your entire product then be made available on an open source basis.

There have been a number of law suits worldwide in relation to the enforcement of open source licences.  These licences should therefore be taken seriously.

We have seen two key issues arise with the use of open source.  These are:

  • The requirement that certain products incorporating open source code must themselves be distributed on an open source basis
  • A failure of users of open source code to generally comply with their licence terms

The biggest impact by far that we have seen however has been in the mergers and acquisitions context.  Most purchasers of technology companies will during their due diligence ask whether the vendor company uses open source and whether it is complying with the terms of the relevant open source licence.  We often see vendor companies only realising at that time that they may have not met their compliance obligations.  This in turn may cost the vendor company money in so far as the purchaser may lower the purchase price they are prepared to pay for the business to take into account the risk faced by non-compliance.

It is therefore important to monitor the use of open source products, tools and libraries in the software you develop.

There are a number of tools online which you can use to comply with the terms of an open source licence.  An example of this is the Linux Foundation Open Compliance Program.

If you have any questions regarding software licensing issues in your business, including in relation to your use of open source products, please don’t hesitate to contact one of our Technology & Media or Intellectual Property lawyers for a confidential discussion.

Author: Darren Sommers

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