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OpenTofu vs. Terraform: The Tug of War created by Terraform’s Licensing Change

Summary of Linux Foundation’s OpenTofu Manifesto (Assisted by ChatGPT)

HashiCorp open-sourced Terraform under the Mozilla Public License in 2014. Over nine years, it cultivated a vast community. On August 10th, 2023, HashiCorp unexpectedly shifted Terraform’s license to the Business Source License. This sudden change poses potential legal risks for many businesses, including start-ups, and threatens the Terraform community’s stability. Concerns arise due to the vagueness of this new license, causing uncertainties for its users. As a result, there’s anticipation that the Terraform open-source community may decline. To counteract this change and maintain an open-source ethos, a group has forked Terraform. This fork, named OpenTofu, will be supported by the Linux Foundation, ensuring it stays genuinely open-source, community-driven, impartial, and backward-compatible.
Figure 1: OpenTofu image from Linux Foundation.

My Opinion

This move by HashiCorp is familiar and will not be the last.  Since 2018, many software providers have introduced restrictions on how their code can be used, including well-known names such as Cockroach Labs, Confluent, MongoDB, Redis Labs, Red Hat, and Sentry.  The move from being fully open-source is being taken from a business perspective as companies look to augment their revenue base.  However, the impact on innovation will suffer as contributions from the open-source community are likely to shrink with the change in licensing agreement.

But, the rapid and robust response from the open-source community in response to the shifts in Terraform licensing underscores the lasting importance of open-source initiatives. We must wait and watch how this gets played out in the market between Terraform and OpenTofu.  While making a call is early, the customer will most likely win the game. Customers can choose between two paths in open-source software adoption as time progresses. While enterprises will likely stay with HashiCorp, start-ups will lean towards open source. Organizations participating in the OpenTofu initiative are dedicating full-time equivalents (FTEs) to support these efforts, which improves the likelihood of ongoing success. If many companies like Harness band together to continue innovating with OpenTofu, time will tell if they can overcome the innovation coming out of HashiCorp.

 

Ram Viswanathan, Consultant and ex-IBM Fellow, and Dave Nielsen contributed to this blog post.

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