Open source software ("OSS") is quickly entering the mainstream and becoming increasingly widely used.  In fact International Data Group analysts have predicted that the OSS marketplace will be worth £35 billion by 2008. 

OSS is software that is freely available (without discrimination) and can be copied, modified and redistributed.  In return for a free licence users may be required to provide access to the full source code, including any modifications, and to licence those modifications on the same terms.

One of the main benefits of OSS for businesses is that because anyone is free to access and develop the software, it evolves much more quickly and efficiently than it would in the traditional proprietary model (where the source code is typically kept secret and where the licensee has no access to develop it).  Bugs and defects are usually quickly noticed and rectified.

In order to be OSS, software must be licensed on terms that meet the criteria set out by the Open Source Initiative.  As a result, a number of different licence models have developed, the best known of which include the GNU General Public Licence, the GNU Lesser General Public Licence and Apache.

One of the best-known features of OSS is that certain open source licences require that, where software is created using open source code, the software produced must also be made available as OSS.  This is often referred to as the "viral" nature of open source and makes some people nervous about using OSS.

Not all open source licences require this.  Moreover, it is important to distinguish between software that incorporates open source code and software that simply interfaces with open source products.  For example, using a Linux operating system (which is an open source product) does not mean that all software run on that operating system automatically becomes open source.

To date there have been no cases in the Scottish, or indeed UK, courts under which OSS licences have been tested.  The General Public Licence has, however, been tested and upheld in the German courts.  There is also a long running case in the US between SCO and IBM that has implications for OSS in that country and is expected to come to trial in 2007.

Again, this litigation makes people nervous about using OSS.  However, new insurance products on the market address the risks faced by companies who rely upon OSS.  Companies may use this type of insurance to protect against giving warranties in a corporate transaction or simply to provide cover where their commercial product incorporates open source. 

Businesses that use OSS are benefiting.  They are no longer tied into using one support provider and can readily move software support provider without difficulty as they have access to the source code of the software they use.

If you are considering joining the ever-increasing ranks of businesses that use and benefit from OSS then it is important to remember that thorough research on the ways in which open source will be used in your software products should be performed, and it is as important as ever to have a robust contract in place.  Be aware of the risks and take simple precautions, such as ensuring that your organisation keeps good records of any open source software that is used. 

Alison White is a partner specialising in media and technology with law firm Shepherd and Wedderburn.  0131 473 5313.

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