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Disclaimer: This article is not legal advice. If you are uncertain about this topic and valuable assets are at stake, come into contact with qualified legal counsel.
The basis of licensing is copyright. If you wish to understand licensing, you need to understand the basics of copyright law. What is copyright? Encyclopedia Britannica defines it as follows:
copyright, the exclusive, legally secured right to reproduce, distribute, and perform a literary, musical, dramatic, or artistic work.
Now commonly subsumed under the broader category of legal regulations known as intellectual-property law, copyright is designed primarily to protect an artist, a publisher, or another owner against specific unauthorized uses of his work (e.g., reproducing the work in any material form, publishing it, performing it in public, filming it, broadcasting it, or making an adaptation of it).
In summary, the goal of copyright is to protect the author of a work. The person who owns the copyright is called a copyright holder.
How is copyright established and put into effect? Historically, centuries ago, this used to vary by national jurisdiction. It was not guaranteed that a book author would have his creative work of art protected in every country. Today, however, most nations on the planet, including North Korea, are signatories of the International Convention for the Protection of Literary and Artistic Works, or Berne Convention for short. Signatories of the Berne Convention constitute the Berne Copyright Union, which as of 2022 totals 179 nations.
International Convention for the Protection of Literary and Artistic Works
The practical effect of the Berne Convention for the normal person is that the strictest possible copyright protection applies by default to any creative work they create. This means that if you write a book in USA, Germany, China, or any other of the Berne Copyright Union countries, all rights of the work are reserved to you, and nobody is legally allowed to derive from or distribute your work. This applies to software, musical composition, or any other work that the local jurisdiction considers "creative". Violating copyright is called copyright infringement.
There exists an unfortunate, but widespread, pop myth: that lack of monetisation of derivative copyrighted work makes you immune to prosecution. This is wrong. It is still copyright infringement. If you create "fan art" of Warhammer 40,000 or Star Wars, not taking money for the work has no legal impact. Warhammer 40,000 and Star Wars are copyright of Games Workshop and Disney, respectively, and you are legally obliged to ask for permission from these copyright holders if you may create derivative work of their work. The only reason why "fan communities" of popular media franchises are allowed to operate is because they are a net benefit to the copyright holders. Fans create hype, and so it is sound business to let their copyright infringement slide. This strange symbiotic relationship has an unfortunate effect of distorting people's understanding of copyright law.
As you might imagine, reserving all rights for copyright to yourself is good, but it is not very useful without allowing others to see and maybe even distribute the work, in exchange for financial benefit to you. This is where licensing comes in.
Although film theatres do not own the copyright of Star Wars, they are still allowed to screen films, at least for a time, from the Star Wars franchise. This is because Disney is giving film theatre companies the licence to play the films. Usually this comes at a fee. Usually licences come with many terms that dictate what the licensee is allowed to do with licensed work. In this way, Disney allows the general public – in a controlled way – to consume their copyrighted work. Disney might stipulate that the latest Star Wars film shall be in theatres for only six months, or most of any other stipulation, as long as it is legally enforceable and not in violation of contract law.
As explained earlier, when you create a work, all rights are automatically reserved to you, per Berne Convention. This includes software. Nobody is allowed to use your software without your explicit permission when you first create it. Licensing is a legal avenue of providing permission to others of when and how they may use your software. Therefore it is essential that you understand how to select and employ your licence for your program.
Before we get to that, we should look at one last thing: open source versus closed source software. Encyclopedia Britannica defines open source as follows:
"Open source" Britannica definition
open source, social movement, begun by computer programmers, that rejects secrecy and centralized control of creative work in favour of decentralization, transparency, and unrestricted ("open") sharing of information. Source refers to the human-readable source code of computer programs, as opposed to the compiled computer programming language instructions, or object code, that run on computers but cannot be easily understood or modified by people.
In closed-source, or proprietary, software development, only the object code is published; the source code is held secret in order to control customers and markets.
The question of open source and closed source software caused, and continues to cause, controversy in the tech world. Proponents of free and open source software (FOSS) claim that copyright law is outdated, and not fit for modern demands. We can briefly investigate how that is.
Software that is closed source, or proprietary, cannot be modified and freely distributed. This is the most common type of software, since it is in line with the traditional ways of copyrighted work: reserving most of all rights, allowing access only for direct financial benefit.
This is understandable, but at the same time it poses philosophical and ethical questions. To take the most obvious example: Windows is the most widely used proprietary software on the planet. If you have Windows 10 installed on your computer, do you know what your computer is doing at any given time? No, because you do not have access to the source code of Windows 10. It is also doing not very good things, as illustrated by Edward Snowden, who exposed PRISM. Microsoft and many other large US-based tech companies forward information about you to the National Security Agency. To many people that came as a shock, but to most proponents of FOSS it was exactly to be expected. FOSS proponents are deeply distrustful of proprietary software for this, and many other, reasons.
These concerns are entirely unique to software. Copyright law is on the side of Microsoft in spying on its users and even sending data to intelligence agencies without their consent. Songs, books, prose, newspapers, paintings, sculptures, and so on, cannot spy on you. This is why the issue of software licensing is not just legally complicated, but also philosophically complex.
On the other hand, open source software is software that can be freely modified and distributed by its users. You are entitled to view the source of the program, modify it, and distribute it however you desire, without restriction. Otherwise it is not considered open source software.
This raises an obvious question: why make your software open source? There are many reasons for why it is beneficial, even if it's not immediately obvious why.
* DOOM: The code base of the game is open source, but the art assets are still copyrighted and not free for distribution. You still have to pay for the art assets, in other words.
* Mindustry: The game is both free (no cost) and open source, but you may purchase a licence of the game on Steam for additional features.
* Zrhythm: Open source, but the executable files have to be paid for. This means that if you are sufficiently tech-savvy, you can simply compile the executable files yourself, and you skip the costs.
These are just some of the reasons why FOSS proponents choose to make their software open source. You simply have to explore GitHub. It is the largest website for open source software.
Contrary to proprietary licences, open source licences allow conditional or unconditional access to the source code for everyone. Open source licences are applicable to all forms of media, but are typically used for software. The European Union maintains an interactive list of the various known open source licences. Here is a curated list of the three best licences that preserve the rights of both the author and end-users of their software:
Interactive list by European Commission
* Can: Use/reproduce, Distribute, Modify/merge, Commercial use, Use patents, Place warranty
* Must: Incl. Copyright, State changes, Disclose source, Copyleft/Share a., Include licence
* Can: Use/reproduce, Distribute, Modify/merge, Commercial use, Use patents, Place warranty
* Must: Incl. Copyright, Royalty free, State changes, Disclose source, Copyleft/Share a., SaaS/network, Include licence
* Can: Use/reproduce, Distribute, Modify/merge, Commercial use, Use patents, Place warranty
* Must: Incl. Copyright, Disclose source, Copyleft/Share a., Lesser copyleft, Include licence
There are a few legally acknowledged, or "correct", ways of licensing a program. To learn more about that, read this. Information on that page is applicable to any other licence you use for software. If you follow the directions, your software should be legally protected. Make your licence as easily visible as possible, so that both end-users and abusers understand that your rights and rights of the end-user are protected.
How to Use GNU Licenses for Your Own Software
If you do not care about the particulars of licensing, and want to secure your software, using the licences mentioned above is enough. Otherwise, there are important issues to be known with how licensing of software works with today's copyright law. As mentioned earlier, software is unusual as a medium, and copyright law was not designed to fairly process it – fairly for the consumer, anyway.
The key to understanding open source licences is that they are an ugly jury-rig. A hack, if you will, of copyright law. It glues together modern demands of software and the Internet with old, rigid, outdated legislation from over one hundred years in the past. Here's what that means:
Technically, the copyright holder of the Linux kernel is still Linus Torvalds. However, he, through the GNU General Public License 2.0 (GPL-2.0), allows conditional access to the kernel code. The biggest condition of the licence is that a person, who redistributes or performs a modification on the kernel, has to license his distribution or modification under the GPL-2.0 licence. In this way, all derivative versions of the kernel become licensed under the licence, because it is itself a licence term. This "legal virality" is how the kernel is legally protected, and retains its protection across all modifications. Where does Linus Torvalds, as a copyright holder, fit in this? That's the thing: he doesn't. Him being a copyright holder is entirely irrelevant, because the licence terms do not give him any special treatment. There is no clause that allows him to revoke licensed access to the kernel. The kernel is going to be free and open source, forever.
Yet, he is required to be a copyright holder, because legally the copyright holder cannot be "nobody". It's simply a legal concept that does not exist in copyright law, as there was never a time in history where that was useful for anybody.
Not all open source licences are created equal, and you should be wary of certain ones. GPL-3.0, EUPL-1.2, and MPL-2.0 are the best, as they secure the largest amount of rights for both the author and the author's end-users. There are, however, licences that do none of these things. Here's a few of them, but the list is by no means exhaustive:
What is wrong with these licences? The issue is rather simple: the terms of these licences do not include that all modifications of the software fall under terms of the same licence. What this means is that if one were to for instance take code licensed under MIT License, and perform modifications on it, one would be allowed to apply all modifications under any licence; regardless of whether they're proprietary or not. This is what's called a permissive licence, or idiotic licence, because it misses the entire point of making a software's source open to begin with.
Why Open Source Misses the Point of Free Software
To underline how catastrophically useless an idiotic licence can be, one should look no further than the story of Andrew Tanenbaum and his MINIX venture. MINIX is an operating system, and was licensed under some form of BSD licence and, to Tanenbaum's utter obliviousness, was used by Intel in their Management Engine. The Management Engine, or ME for short, is a micro operating system that runs on any modern Intel CPU. Nobody knows what it does, and theoretically can be used by governments or sufficiently savvy hackers to steal cryptographic keys, or do other nefarious things no sane person would consent to. Intel was entirely justified in appropriating MINIX to build ME from. None of the terms in the BSD licence force Intel to reveal source, its modifications, or even license modifications under the same licence. Tanenbaum did not even know that MINIX was used for this purpose until several years after the fact.
Tanenbaum has been in personal conflict on this issue, since he got to know that MINIX is now world's leading spyware. He regrets choosing an idiotic licence to license his software, but occasionally copes with the catastrophic, ill-advised decision as being inevitable:
Many people (including me) don't like the idea of an all-powerful management engine in there at all (since it is a possible security hole and a dangerous idea in the first place), but that is Intel's business decision and a separate issue from the code it runs. A company as big as Intel could obviously write its own OS if it had to. – Andrew Tanenbaum
Tanenbaum is correct in that Intel would, at some point, write their own operating system to become hardware-level spyware on all of their products, but it doesn't change the fact that one person is responsible for the origin of ME: Tanenbaum. If MINIX had been licensed under, for example, GPL-3.0, Intel would have been forced to disclose source code of ME, all of its modifications, reveal Tanenbaum as the copyright holder, and many other important conditions. If Intel did not wish to face this immense legal liability, they would have been forced to spend their own cash, time, and manpower to develop a new, proprietary alternative. It would have been a lot of money, but, because of Tanenbaum, they were spared all of that. Thanks, Tanenbaum.
All in all, everyone who develops any kind of software has to avoid idiotic licences. MIT Licence is the most commonly used open source licence, which should speak for itself of how serious legal illiteracy is in software engineering. Do not make the same mistake, and pick an appropriate licence for your work.