Technology Explained

What Is Proprietary Software? 5 Ways It Beats Open-Source Software

Bertel King 12-03-2018

Have you given any thought to the way the software on your computer is designed? If you bought your PC in person, chances are it’s running proprietary software: software that’s typically created for profit, for which you can’t edit the source code yourself.


When you agree to a lengthy End User License Agreement when installing a new program, you’re likely installing proprietary software.

Why is most of the software we encounter on Windows, macOS, and our smartphones proprietary? Well, there are certain advantages to this style of software creation and distribution that lead many developers to see it as the way to go.

What Is Proprietary Software?

Proprietary software is software that is privately owned by a proprietor. That means someone owns the intellectual property rights to the code that makes the program run. The owner may be a company or an individual developer.

Proprietary software is also known as closed-source software. This is in contrast to free and open-source software Open Source vs. Free Software: What's the Difference and Why Does It Matter? Many assume "open source" and "free software" mean the same thing but that's not true. It's in your best interest to know what the differences are. Read More , which lets you view, edit, and redistribute the code that makes a program tick. Proprietary software doesn’t grant you this permission. Instead, its code is often not accessible. Companies distribute these programs as binary files that we aren’t permitted to crack open.

Closed source software may be prevalent these days, but that hasn’t always been the case. While the term “free software” came around in 1980s, and “open source” wasn’t coined until 1998, software was largely free of cost and restrictions before 1980.


That was the year the US Congress extended copyright protection to computer programs. Companies such as IBM and Apple encouraged this move because they wanted an alternative way to monetize computer products. This business model has since become the de facto way to produce software.

So what attracts developers to the proprietary model? And what are the perks for users? Here are some of the big ones.

1. Clear Revenue Scheme

Developing software takes time. How do you make money doing it? If you’re a computer company, your core revenue comes from hardware sales. But then you’re in a tough spot if everyone who needs or wants a computer has already bought one.

You either have to plan obsolescence and arbitrarily shorten the life of your product Planned Obsolescence: Why We Can't Have Nice Things How much money are you wasting due to "planned obsolescence"? In this article, we explain what that is, why it should concern you, and what you might be able to do about it. Read More , or you find a way to monetize the software that people use on those machines (or, as the industry has shown us, why not both?).


Microsoft is a tech giant thanks to the ability to copyright software. For most of its history, the company has made the bulk of its money from sales of Windows and Microsoft Office. Apple is known more for its hardware, but it also brings in money from music sales on iTunes and app sales in the Apple App Store.

If you’re an independent developer looking to create your own app or start a software company, making your program proprietary allows for a pretty straightforward business plan. If you’re an open source software creator, how you make money isn’t nearly as clear cut Understanding How Open Source Software Developers Make Money The truth is: many OSS developers and projects do generate revenue. Read More .

2. Easier to Establish Vision and Direction

Not only is it easier to determine a financial plan with closed-source software, but it’s easier to establish any kind of plan.

You and your team are the only people who have any say over what shape a project takes. Working in private gives you the freedom to experiment in radical ways without fear of someone shooting down your half-completed prototype. You can also work on a project for years without anyone knowing and criticizing your slow rate of progress.


On Linux, Ubuntu recently abandoned the next version of its Unity interface What Switching Back to GNOME Means for Ubuntu Canonical has announced the end of the Unity desktop. From Ubuntu 18.04, the GNOME desktop will be restored. What does this mean for Ubuntu, and its relationship with Linux users? Read More after spending years preparing the software for release How to Install Unity 8 and Mir on Linux Ubuntu Right Now In time, Unity 8 is expected to unify the Ubuntu experience across phones, tablets, and desktops, using the Mir display server. You can try both of them out today with Ubuntu 16.10 Yakkety Yak. Read More (and receiving a fair bit of criticism along the way).

The GNOME project released version 3.0 back in 2011, but it was years before the interface reached a point that many would consider mature GNOME Explained: A Look at One of Linux's Most Popular Desktops You're interested in Linux, and you've come across "GNOME", an acronym for GNU Network Object Model Environment. GNOME is one of the most popular open source interfaces, but what does that mean? Read More . Whether you try to release a project only when it’s ready or you release a less complete experience early and iterate along the way, eyes are watching and commenting on what you do.

People tend to resist change and may shoot down a project for being too different from what they know. A little bit of privacy goes a long way toward giving your software a fighting chance.

Jaron Lanier, author of You Are Not a Gadget, draws a parallel with biology:


“Creativity requires periodic, temporary ‘encapsulation’ as opposed to the kind of constant global openness suggested by the slogan ‘Information wants to be free.’ Biological cells have walls, academics employ temporary secrecy before they publish, and real authors with real voices might want to polish a text before releasing it. In all these cases, encapsulation is what allows for the possibility of testing and feedback that enables a quest for excellence. To be constantly diffused in a global mush is to embrace mundanity.”

On the other hand, once you get your vision into the world, proprietary software often lives and dies based on how competitive it is. Many awesome projects have disappeared over the years due to their inability to bring in enough revenue.

These programs lose compatibility with newer operating systems, and the developers never release the code. Thus, users miss out. Meanwhile, creative open source projects can continue to exist without ever driving a profit because making money was never the point.

3. Encourages More Consumer Software

When you walk into a store, there’s a strong chance that all the software you see on display is closed source. This includes everything from operating systems to virus scanners to video games. Proprietary software development views programs as products, so it encourages the creation of more products.

Open source development treats software more as code. Code should be free to view, edit, and share. And if a program already exists that does what you need, there’s less reason to write your own code from scratch. That’s not to suggest that there isn’t a lot of duplicated effort in the open source world, but you don’t have the same numbers of people making competing versions of similar programs in order to grab the most dollars.

The Apple App Store and Google Play are filled with proprietary apps. Steam is packed with closed source games, many of which are rather innovative:

There are plenty of great open-source programs The Best Linux Software and Apps Whether you're new to Linux or you're a seasoned user, here are the best Linux software and apps you should be using today. Read More in the world, but many of these programs have been around for years if not decades. There just aren’t as many quality open source desktop apps available.

4. Better Security in Some Situations

You may have heard security touted as one of the advantages of open source software. When everyone can see the code, we can see and address potential exploits. We also can confirm whether the program is doing something shady.

But this is only the case if someone actually looks through all of the code. A bug can exist on a core component of every Linux computer for decades without anyone noticing. Granted, this happens in proprietary software like Windows, too. That just goes to show that neither approach is necessarily a better way to deal with bugs.

Nonetheless, there are some scenarios where it’s better to go with closed-source software. Do we all need to see the source code for programs used to launch missiles? It’s probably better for fewer people to have access to such software and the expertise to make it. And while security through obscurity can’t be the only line of defense Is Security Through Obscurity Safer Than Open Source Software? Open source software comes with clear security benefits. The opposite approach is security through obscurity. Is one approach actually safer than the other or is it possible that there's truth to both? Read More , there are cases where it helps.

5. More Responsive Support

Most free and open source software is provided on an as-is basis. You can report bugs and hope that someone takes the time to fix them, but no one is obligated to do so. If you have the knowledge, you can fix the problem yourself and share the fix with others. That’s one of the great advantages of open source software, but most of us aren’t in a position to fix bugs ourselves even if we are programmers.

Proprietary software is often provided as a product. The owner views it users as consumers, and they have an expectation that what they buy will work a certain way. Developers thus have more of an obligation to tackle problems. Sometimes there’s a clear email address or phone number you can contact in order to receive support.

That’s not to say that closed-source software doesn’t have bugs. Glitches, lag, and poor performance are among some of the main reasons people consider switching from Windows to Linux 7 Warning Signs That You're Meant to Switch to Linux I was a Windows user for years, but was doing things that have taught me I'm a Linux user at heart. Wondering if you're a secret Linux user? Here are the warning signs. Read More . But at least you know where to turn and have some degree of leverage when you need support.

Is Proprietary Software Better?

Proprietary software is prone to drastic change and sometimes even manipulative behavior Don't Let Windows 10 Spy on You: Manage Your Privacy! Windows 10 is watching you. Microsoft's latest operating system is undoubtedly harvesting more of your personal information than ever before. We'll show you how to get a better grip on your privacy. Read More in order to compete in the marketplace. Expensive software also isn’t available to people without the money or in regions where the program isn’t for sale.

But it would be outright dishonest to say that the proprietary model doesn’t have its benefits.

I personally use Linux and prefer free software 5 Reasons Why Software Should Be Free and Open Source Free software doesn't just mean you get to use the app or game without paying. It's about longevity, privacy, ownership, and much more! Read More . Proprietary software may offer a clearer way to make money, but these programs tend to go away once the income dries up.

Related topics: Open Source, Software Licenses.

Affiliate Disclosure: By buying the products we recommend, you help keep the site alive. Read more.

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  1. SpaceGarbageManifestation
    June 2, 2018 at 1:20 pm

    1.Time is a product tool build for the satisfaction of participation plots;
    2.Money is a proprietary tool showcased valued by performance actors;
    3.Copyright is the proprietary manner of creation process;
    4.Customization process is presented plugins, addons, user content at developer organization;
    5.Products is products like conversation in talk, it lies realities in pollution and chaos for what to interact with where never there;
    6.Security is a failing process of the machine that better processing helds communication realities at for more capable tools;
    7.Simplicity of the processing tool lack in the path of information the acquirement of usability which proprietary manner are proprietary activity conflicting the customization which extent of realities by success over the profit situations makes the consumer;

  2. Reader
    May 23, 2018 at 10:17 pm

    Better Security in Some Situations (and worse in others)

    So let's agree we can give that point to proprietary software!

  3. tabp0le
    March 13, 2018 at 3:59 am

    This is one of the most uneducated and ridiculous articles I've seen. None of your points are valid, except if you're the company trying to profit.

    1. Yeah maybe
    2. Vision/direction: BS. Open source is much easier to visualize your progress and get feedback to see if your ideas are even worth it. Additionally, you don't have to make your changes public until you have a release. (for GPL licensing. You don't even have to release reused code for many other licenses.
    3. Nothing says open source software can't be sold in a store. Many programs are forks of existing software which brings many more features. This actually increases the availability of consumer software.
    4. Closed source security is NEVER better. NEVER. Without the ability to openly audit, your chances of having un-patched holes are much higher. There's a reason why the organizations and governments in need for the highest security use Linux. (An awesome example of opensource)
    5. Open source programs have much easier ways of getting support. Fast patches, typically and community support. Many large and small projects offer a "paid" version, which usually just means enterprise level support. Much better than you'd ever get from MS or the likes.

    This is an awful article, and spreads ignorance.

    • konj
      March 14, 2018 at 10:27 am

      Completely agree with you. This article is awful and to some extent stupid.

      • Paul
        May 26, 2018 at 9:32 pm

        Full agree! I was even astonish at the end of it to read the author uses Linux. I guess he didn't get much of it.

  4. dragonmouth
    March 12, 2018 at 11:08 pm

    "1. Clear Revenue Scheme"
    "But then you’re in a tough spot if everyone who needs or wants a computer has already bought one."
    You don't sell your software to users. You make them subscribe to it. Instant guaranteed revenue stream.

    "2. Easier to Establish Vision and Direction"
    Also easier to disregard user suggestions and ram your own vision down their throats. "I am the developer. I will tell you what features you want!"

    "3. Encourages More Consumer Software"
    Sure does. Necessitates third party software to provide the features that the developer of the original software omitted or forgot.

    "4. Better Security in Some Situations"
    Some bugs/vulnerabilities show up only under a very rare set of circumstances, such as hitting the Alt or Shift button for 96 times in a row. My keyboard has 105 keys. How may different key combinations can be made out of that? 105 factorial?

    "5. More Responsive Support"
    Open source problems are fixed and disseminated ASAP instead of waiting for Patch Tuesday. There are bugs and vulnerabilities in Windows that have not been fixed in years. You call that "responsive"?! A user program running under Windows can, and does, sometimes bring down the entire system. This has been a problem since day one. MS still hasn't fixed it. You call that "responsive"?!

    "Companies such as IBM and Apple encouraged this move because they wanted an alternative way to monetize computer products. "
    Computer manufacturers were monetizing their software long before Congress extended copyright protection to software.