The open-source license trap — picking AGPL vs MIT vs Apache

Educational only — not legal advice. Open-source licensing has significant commercial implications; consult a specialist open-source attorney before locking in your license choice.

The license you pick for an open-source project is one of the highest-leverage decisions you make as a founder. The wrong choice means competitors can host your code and sell it; the right choice protects the commercial path you'll need for revenue. Here's the trade-off space.

The two camps

Permissive licenses (MIT, Apache 2.0, BSD) — anyone can do almost anything with the code, including hosting it as a commercial service. No requirement to share modifications. No requirement to disclose derivative works. Examples in the wild: Linux kernel (GPL), React (MIT), Kubernetes (Apache).

Copyleft licenses (GPL, AGPL, SSPL) — derivatives must be released under the same license. AGPL specifically requires service-host code to be open-sourced if you offer the software as a network service. SSPL goes further: hosting providers must open-source their entire stack. Examples: MongoDB (SSPL), Elastic (under SSPL since 2021), Grafana (AGPL).

The classic trap

You pick MIT because it's friendly. You build a thriving open-source project. AWS or another cloud provider hosts your project as a managed service, charges customers for it, and you don't see a dollar.

This has happened repeatedly: MongoDB (re-licensed to SSPL in 2018 after AWS DocumentDB), Elastic (to SSPL in 2021 after AWS Elasticsearch), Redis (changed terms after AWS ElastiCache), HashiCorp (Terraform changed to BSL in 2023).

Each re-license caused community backlash and forks (OpenSearch, OpenTofu). The damage is real; the lesson is to think about the license upfront, not retroactively.

The decision frame

Ask: what's your commercial path?

• Cloud-hosted managed service is the primary revenue line. AGPL or SSPL protects against cloud providers competing with you. Cost: some companies refuse to use AGPL-licensed code at all. Acceptable trade-off if your buyer is the founder/CTO, not procurement.