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

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, 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, 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.

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 after spending years preparing the software for release (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. 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 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, 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. 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 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. Proprietary software may offer a clearer way to make money, but these programs tend to go away once the income dries up.