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In the answers to this question it was shown, that a few licenses exist, that are only open source but not free software or the other way round. Still, most licenses are both or neither, so the overlap is very big.

But the communities around open source are distinctive and both strong, and some members of one community even disagree with the other. That seems strange for communities that are so similar in definition and goals. It points to a subtle philosophical difference the two.

So my question is: do such differences exist? And if yes: What are the differences in philosophy?

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I recommend visiting:

Philosophy of the GNU project is closely relevant with Free software movement and hence free software philosophy.

Notable points (from GNU):-

In addition to / Including @Michael Schumacher's answer.

Open source is a development methodology; free software is a social movement. For the free software movement, free software is an ethical imperative, essential respect for the users' freedom. By contrast, the philosophy of open source considers issues in terms of how to make software “better”—in a practical sense only. It says that nonfree software is an inferior solution to the practical problem at hand.......

For the free software movement, however, nonfree software is a social problem, and the solution is to stop using it and move to free software.

Practical difference:

Open source doesn't take Tivoization as issue while for Free Software, it is ethical/social problem: (Quoted form Why Open Source misses the point of Free Software)

...Even if the executable is made from free source code, the users cannot run modified versions of it, so the executable is nonfree.

The criteria for open source do not recognize this issue; they are concerned solely with the licensing of the source code. Thus, these unmodifiable executables, when made from source code such as Linux that is open source and free, are open source but not free.

Different Values:

The idea of open source is that allowing users to change and redistribute the software will make it more powerful and reliable. But this is not guaranteed. Developers of proprietary software are not necessarily incompetent. Sometimes they produce a program that is powerful and reliable, even though it does not respect the users' freedom. Free software activists and open source enthusiasts will react very differently to that.

A pure open source enthusiast, one that is not at all influenced by the ideals of free software, will say, “I am surprised you were able to make the program work so well without using our development model, but you did. How can I get a copy?” This attitude will reward schemes that take away our freedom, leading to its loss.

The free software activist will say, “Your program is very attractive, but I value my freedom more. So I reject your program. I will get my work done some other way, and support a project to develop a free replacement.” If we value our freedom, we can act to maintain and defend it.

Notable para from fear of freedom:

  • The rhetoric of open source has convinced many businesses and individuals to use, and even develop, free software, which has extended our community—but only at the superficial, practical level. The philosophy of open source, with its purely practical values, impedes understanding of the deeper ideas of free software; it brings many people into our community, but does not teach them to defend it. That is good, as far as it goes, but it is not enough to make freedom secure. Attracting users to free software takes them just part of the way to becoming defenders of their own freedom.

  • Most GNU/Linux users were introduced to the system through “open source” discussion, which doesn't say that freedom is a goal.

From Richard Stallman's TEDx video:

Comparison of philosophical views

Notable points (from OSI):-

The mission of opensource says:

Open source is a development method for software that harnesses the power of distributed peer review and transparency of process. The promise of open source is better quality, higher reliability, more flexibility, lower cost, and an end to predatory vendor lock-in.

Quoted from opensource history:

The conferees also believed that it would be useful to have a single label that identified this approach and distinguished it from the philosophically- and politically-focused label "free software."

Quoted from OSI FAQ:-

The term "open source" was coined in 1998 by a group of people — the founders of the Open Source Initiative (OSI) — who also supported the development and distribution of free software, but who disagreed with the FSF about how to promote it, and who felt that software freedom was primarily a practical matter rather than an ideological one (see for example the entry "How is 'open source' related to `free software'?" from the OSI's original 1998 FAQ page).

Following the coining of the term "open source", some of those who adopted it did so because they too had philosophical differences with the FSF about the reasons why to promote such software, while others who adopted the term did so because of differences of opinion with the FSF about tactically how to support such software, even while sharing an ideological motivation. These two groups can and do overlap, of course, and some people use both terms, choosing according to context and audience.

Also categories of free and non-free software from this answer which graphically explains difference/overlap i.e how opensource is free (mostly) and non-free (rarely).

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    Note: "We in the free software movement don't think of the open source camp as an enemy; the enemy is proprietary (nonfree) software. But we want people to know we stand for freedom, so we do not accept being mislabeled as open source supporters." -by rms.
    – Pandya
    Jul 10, 2015 at 14:12
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    there are, however, some people in the open source community who consider free software the enemy. Free licenses have been described as "a cancer that attaches itself in an intellectual property sense to everything it touches".
    – Abhi Beckert
    Sep 25, 2015 at 20:11
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    Not everyone in 'free' software hates tivo -- Note Linux.
    – bmargulies
    Sep 26, 2015 at 1:35
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To me, the following part of the Why Open Source misses the point of Free Software article sums up the difference (emphasis by me):

Some of the supporters of open source considered the term a “marketing campaign for free software,” which would appeal to business executives by highlighting the software's practical benefits, while not raising issues of right and wrong that they might not like to hear. Other supporters flatly rejected the free software movement's ethical and social values. Whichever their views, when campaigning for open source, they neither cited nor advocated those values. The term “open source” quickly became associated with ideas and arguments based only on practical values, such as making or having powerful, reliable software. Most of the supporters of open source have come to it since then, and they make the same association.

The two terms describe almost the same category of software, but they stand for views based on fundamentally different values. Open source is a development methodology; free software is a social movement. For the free software movement, free software is an ethical imperative, essential respect for the users' freedom. By contrast, the philosophy of open source considers issues in terms of how to make software “better”—in a practical sense only. It says that nonfree software is an inferior solution to the practical problem at hand.

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Yes, they exist.

When we call software “free,” we mean that it respects the users' essential freedoms: the freedom to run it, to study and change it, and to redistribute copies with or without changes. This is a matter of freedom, not price, so think of “free speech,” not “free beer.”

...

Since the obvious meaning for “open source” is not the meaning that its advocates intend, the result is that most people misunderstand the term. According to writer Neal Stephenson, “Linux is ‘open source’ software meaning, simply, that anyone can get copies of its source code files.” I don't think he deliberately sought to reject or dispute the official definition. I think he simply applied the conventions of the English language to come up with a meaning for the term. The state of Kansas published a similar definition: “Make use of open-source software (OSS). OSS is software for which the source code is freely and publicly available, though the specific licensing agreements vary as to what one is allowed to do with that code.”

Source: Why Open Source misses the point of Free Software

The term open source was kind of created because free software is not a very good term to use in a business world (source). Open source is a bit less restrictive than free software. Because every piece of free software can be classified as open source software too (taken from the content of their definitions here and here), it's perfectly normal that the term open source is more widely used.

Free software's essential freedoms

A program is free software if the program's users have the four essential freedoms:

  • The freedom to run the program as you wish, for any purpose (freedom 0).
  • The freedom to study how the program works, and change it so it does your computing as you wish (freedom 1). Access to the source code is a precondition for this.
  • The freedom to redistribute copies so you can help your neighbor (freedom 2).
  • The freedom to distribute copies of your modified versions to others (freedom 3). By doing this you can give the whole community a chance to benefit from your changes. Access to the source code is a precondition for this.

Open source criteria

  1. Free Redistribution
  2. Source Code
  3. Derived Works
  4. Integrity of The Author's Source Code
  5. No Discrimination Against Persons or Groups
  6. No Discrimination Against Fields of Endeavor
  7. Distribution of License
  8. License Must Not Be Specific to a Product
  9. License Must Not Restrict Other Software
  10. License Must Be Technology-Neutral

Comparison

Free software's freedom 0 requires OSD criteria 5, 6, 7, 8, 9, and 10; freedom 1 requires OSD criterion 2 (and possibly 7); freedom 2 probably requires OSD criteria 1, 7, 8, and 9; and freedom 3 probably requires OSD criteria 1, 2, 3, 4, 7, 8, and 10.

Therefore, every free software is open source software and satisfies all of its criteria. The reverse doesn't have to be the case.

As an example, NASA's Open Source Agreement (NOSA) is approved by the OSI (source) but not approved by the FSF because it allows only contributions that are developed by the contributor and doesn't allow contributions that use the code developed by some third party (source). Therefore, every piece of software that uses NOSA as its license is open source, but not free software.

Summary

To sum it up, open source means that the users have the access to the source code, but free software means that the users are free to use the code in any way they want. If something is considered as a free software, you can also use the term open source for it. But not every piece of open source software is actually free software. There's that big difference between the terms that confuses people.

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    Please write a constructive comment when you're downvoting my answer so I could improve it.
    – r3bl
    Jul 4, 2015 at 21:31
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    I didn't down vote, but your answer is all opinions. Perhaps you could add information from both sides on the matter, that is factual and that you include the sources to back those claims?
    – Zizouz212
    Jul 5, 2015 at 17:41
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    You should add that the term open source was coined to avoid the 'freedom' philosophy (that is described in your source in more detail). It seems to be this part that the business world seems to have problems with, not the actual software.
    – Michael Schumacher
    Jul 6, 2015 at 6:52
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    The answer is improving, but not quite there yet. This is one of the answers where having some people from the FSF answering would be most beneficial.
    – Michael Schumacher
    Jul 6, 2015 at 7:10
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    It'd be awesome to see your comparison section in graphical form.
    – mattdm
    Jul 7, 2015 at 12:38

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