UK: Law In Business: Open Source Of Confusion

Last Updated: 27 December 2006
Article by John Buyers

There is more to free software applications than meets the eye. John Buyers looks at the legal risks of open source software

At face value, the open source software (OSS) proposition looks too good to be true. Free, or at least inexpensive, software applications that provide equivalent functionality to much more expensive proprietary products, backed up by thousands of software developers constantly working on upgrades and fixing bugs.

As ever, the reality is more complicated. OSS may usually be free and flexible, but it is still protected by copyright and licensed. To quote the Free Software Foundation (FSF): "Free software is a matter of liberty, not price. To understand the concept you should think of ‘free’ as in ‘free speech’, not as in ‘free beer’."

It is the proliferation of different licences for OSS that can create problems for businesses using or adapting open source applications or code. These include the most commonly found licence templates, such as the General Public License (GPL), the Mozilla Public License, the Apache License and the Berkeley Software Distribution License while others are issued by IT companies such as Intel, Sun Microsystems and IBM.

Many open source licences are certified by the Open Source Institute (OSI) and generally, these certified licences allow for the source code to be inspected, used, copied, modified and distributed without paying a fee or royalty, but even OSI-approved licences can have some critical differences.

For example, some, such as Mozilla, require that any modification to the code should be made publicly available and there are usually stipulations about how modified versions of the code can be relicensed, particularly with regard to crediting the original source, warranties, disclaimers and indemnities.

The latest version of the GPL — GPLv3 — currently being drafted by the FSF, seeks to tighten the restrictions on the exploitation of OSS by restricting the use of digital rights management (DRM) and software patenting in open source code. This somewhat crusading measure is seen as particularly targeting hardware devices that contain embedded OSS.

The Tivo PVR set-top box is a particular example. This device, although based on Linux architecture, is heavily protected by patents and DRM protection. It is this so-called ‘Tivoisation’ which is outlawed by the latest GPLv3. Linus Torvalds, creator of the Linux operating system, has voiced strong opposition to this measure, pointing out that it should not be the job of OSS providers to dictate what can and cannot be specified in hardware devices.

To illustrate the variety of open source approaches, some OSS licences permit users to inspect the code but not to modify it, as is the case with those issued by proprietary developers such as Microsoft. However, other OSS producers may also issue different versions of an open source licence, depending on whether the end user is a business or home user. Other products, for example Sun Microsystems’ Star Office package, are sold on a proprietary ‘shrink wrap’ basis with technical support, while also being freely available as an unsupported open source downloadable distribution.

None of these are particularly complicated issues on their own, but legal complications can arise when a business uses a number of open source applications or sources of code, each with different restrictions and obligations and there still remains a lot of uncertainty about the legal position when integrating open source code or adapting it by the creation of derivative versions.

For instance, some licences, including the current version of the GPL, require that all derivative works must "in turn" be licensed under the GPL — a rather difficult concept to accept if you have just funded extensive bespoke adaptation that could potentially give you an edge over your competitors.

Given the relative newness of the OSS concept, it can sometimes be difficult to pinpoint where the dangers of using OSS lie. Indeed, the proponents of OSS accuse the proprietary software industry of spreading scare stories (socalled ‘FUD tactics’ — Fear-Uncertainty-Doubt) to undermine the growth of the open source sector.

However, there are some areas where businesses should clearly be mindful of the risks of using open source-based software. In 2003, the SCO Group, which develops products around the Unix operating system, sued IBM and subsequently other companies including DaimlerChrysler and Autoparts for using the open source Linux operating system (which was developed from a Unix ‘kernel’ and is now a hugely popular open source operating system), claiming that part of its code was subject to its copyright.

Although the cases are still ongoing, SCO’s argument looks weak, but in terms of time and aggravation, the matter has been a costly one for the defendants.

As time passes, the growth of software patents in the US may also spell trouble for OSS — hence the move in the GPLv3 to declare software patent protection incompatible with open source principles — however this will almost certainly be a problem for the proprietary vendors as well. Traditionally, software was only viewed as being protected by copyright, but the US Patent and Trademark Office has in recent years increasingly under-mined this principle by the granting of ever more software-based patents.

In Europe, the immediate threat of a directive on software patenting has receded with the overwhelming rejection by the European Parliament in July 2005 of the proposed directive on the patentability of computer-implemented inventions.

As far as aftersales care is concerned, although some companies provide comprehensive support for the mainstream software, such as their own distributions of Linux, many open source products often have limited or no technical support. While the size of the community of open source developers means that OSS is often debugged more rapidly than proprietary software and becomes more reliable as a result, there is also no warranty with open source products and no software developer to take responsibility for (or at least to indemnify an innocently infringing user for) a product that is found infringe another’s intellectual property.

The US Department of Homeland Security, ever mindful of the security threat to the US economy that bug-ridden software could pose, has recently commissioned a national database from, somewhat ironically, a proprietary consortium of companies to document known bugs in OSS code.

Many of these issues are a function of the youth of the open source concept and the lack of standardisation that inevitably results.

Although ‘freeware’ has been around for some decades, the open source concept has only been in common use since 1998 and debate continues about the its exact definition. There are a variety of ‘flavours’ of open source, each dictated by their own licensing terms, so one must be careful not to fall into the mistake of treating all OSS uniformly.

The uncertainty that these problems creates has inevitably drawn the attention of the authorities in the more highly regulated industries, such as the banking and financial services sector. Furthermore, the licensing issues around a businesses’ open source applications infrastructure are also becoming a more important factor during merger and acquisition negotiations — specifically in relation to the due diligence process.

This does not mean businesses should not take advantage of the many excellent open source products in the market but businesses do need to tread carefully. Programmers frequently incorporate open source code into their work without considering the licensing implications and it is clear that many chief information officers may not yet know the precise and pervasive extent to which OSS has permeated their company’s systems architecture.

The more prudent CIOs will be aware of where open source code has been used in their company and will have paid for a solution to track such usage. They will have an understanding of which licences apply where and how these licences constrain use of their deployed OSS, above all, they will have a full appreciation of the old maxim: there really is no such thing as a free lunch (or, indeed, a free beer).

John Buyers is a partner and head of commercial, outsourcing and technology at Stephenson Harwood.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.