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We are a small group of developers who are looking to base a product we have in development on a OSL 3.0 licensed Project (OroCRM). I have been having trouble understanding the exact terms of the OSL 3.0 license.

Because the product we are developing will be a commercial product, and we will sell access to it as SAAS, will we be required to open source all of our code that we develop and allow access to anyone?

On Rosenlaw I find this:

The OSL 3.0 Approach To Derivative Works

OSL 3.0 is far simpler, with the entire copyright and copyleft bargain stated in a short § 1 that echoes the provisions of 17 USC 106 and similar copyright laws. Section 1(a) authorizes licensees to make "copies [of the Original Work], either alone or as part of a collective work", and § 1(b) authorizes licensees "to translate, adapt, alter, transform, modify, or arrange the Original Work, thereby creating derivative works ("Derivative Works") based upon the Original Work."

Then § 1(c) requires any copies of that Original Work and any Derivative Works that are distributed to be distributed under OSL 3.0 and, for those works, the Licensor promises to provide Source Code [§ 3]. In this way, the OSL 3.0 license remains with the work and all its subsequent versions, and that software always remains open source. That's reciprocity.

I believe this means that if we distribute our product, that we must use the OSL license, however if we never plan to distribute the code, but only sell access to the product we develop, will we still be required to open up our source code?

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Yes; OSL 3.0 is a copyleft license that also applies if you provide network access to the output of your software, as in SaaS. From the source:

External Deployment Defined

OSL 3.0 requires that the External Deployment of software be treated the same as a distribution. The effect, of course, is that copies of the Original Work or Derivative Works that are externally deployed (i.e., that are used in-house to provide services to third parties) must be distributed reciprocally under OSL 3.0, just as if those third parties had received actual copies of the Original Work or Derivative Works.

This is similar to what AGPL does; even if you don't distribute binaries, if you provide access to the output of your software, you are still bound by the license terms and must provide source under the same license. If you continue reading the Rosen Law page, they make the comparison with AGPL too:

There is a version of GPL, the Affero GPL or AGPL, that also plugs the external deployment loophole, but that license brings along all the other baggage associated with the GPL that I've already criticized. The two-sentence External Deployment provision in OSL 3.0 [§ 5] plugs the loophole.

Here's the actual text from the aforementioned clause #5 in the license, which says pretty much the same thing:

5) External Deployment. The term "External Deployment" means the use, distribution, or communication of the Original Work or Derivative Works in any way such that the Original Work or Derivative Works may be used by anyone other than You, whether those works are distributed or communicated to those persons or made available as an application intended for use over a network. As an express condition for the grants of license hereunder, You must treat any External Deployment by You of the Original Work or a Derivative Work as a distribution under section 1(c).

(bold is mine)

  • Thank you for pointing that out. It is unfortunate for us, because we cannot justify putting several hundred thousand dollars of work into a project that will be open source. I have reached out to them to investigate other licensing options and will continue to look. It seems to me OSL 3.0 makes it very difficult for for profit corporations to work with and contribute to the open source project. – Joel Lewis Jun 3 '16 at 2:48
  • Hi @JoelLewis, do you have an update on what happened? and if you can use the software as SaaS without exposing source code? – Jorjani Jul 9 '18 at 15:45

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