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HashiCorp open source change targets competitors

HashiCorp moves to a Business Source License for all its future product releases that prohibits use for commercial purposes, renewing questions about open core business models.

HashiCorp open source is no more. The company is moving to a Business Source License for all its products.

The company pledged that users of its community edition software and partners that have contributed to projects such as Terraform providers will not be affected by the change. The move -- from a Mozilla Public License version 2.0 to a Business Source License (BSL) version 1.1 on future releases of HashiCorp products -- is an effort to crack down on competitors that use its source code for commercial purposes, according to Armon Dadgar, HashiCorp co-founder and CTO, in a blog post Thursday.

Vendors who provide competitive services built on our community products will no longer be able to incorporate future releases, bug fixes, or security patches contributed to our products.
Armon DadgarCo-founder and CTO, HashiCorp

"[W]e believe commercial open source models need to evolve for the ecosystem to continue providing open, freely available software," Dadgar wrote. "Vendors who provide competitive services built on our community products will no longer be able to incorporate future releases, bug fixes, or security patches contributed to our products."

HashiCorp did not name any of these vendors in the blog post or in an accompanying FAQ. Most of the statements that company reps made were an effort to reassure customers and partners that the license change will not adversely affect them.

"Our first goal with this change is to minimize the impact to our community, partners, and customers," Dadgar wrote. "We will continue to publish source code and updates for HashiCorp products to our GitHub repository and distribution channels."

End users will be able to copy, modify and redistribute the code, and partners can continue to build integrations, "except where providing a competitive offering to HashiCorp," according to Dadgar's post.

HashiCorp isn't the first open core company to adjust its license in this way -- the BSL was developed by MySQL co-founders, one of whom also co-founded MariaDB, which uses BSL. Couchbase adopted BSL in 2021. Vendors including Confluent, MongoDB, Elastic and Redis Labs have moved to similar source-available licenses, in part in response to competition from cloud vendors such as AWS. Red Hat also stirred controversy last month when it altered the way it makes RHEL source code available to developers and users.

This change for HashiCorp follows its fiscal first quarter 2024 earnings report in early June, where executives adjusted revenue guidance for the year downward, citing slowing growth.

Open core business model under scrutiny again

Like its predecessors, HashiCorp's open source defection raised broader questions among enterprise IT pros about the viability of open core business models and the dependability of open source communities governed by a single vendor.

Phil Fenstermacher, manager of systems design and architecture, College of William & MaryPhil Fenstermacher

"In the past few years, it seems like there's been more discussion about the differences between open source with corporate governance versus open source with community governance -- Istio and Knative moving to the [Cloud Native Computing Foundation] were great examples," said Phil Fenstermacher, manager of systems design and architecture at William & Mary, a university in Williamsburg, Va. "I expect this change will bring that conversation forward in more organizations."

Fenstermacher said he didn't expect to be immediately affected as a user of HashiCorp community edition software.

For another HashiCorp user, this also prompted broader questions about the future of open source.

"So in open source if its not under a foundation and by a single vendor, chances are that license can be changed anytime, so the VC's now will have to think before investing in companies built on top of OSS software by single vendor," wrote Saiyam Pathak, field CTO at cloud hosting company Civo, in a tweet this week. "Also more trust goes to foundations."

Beth Pariseau, senior news writer at TechTarget Editorial, is an award-winning veteran of IT journalism. She can be reached at [email protected] or on Twitter @PariseauTT.

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