History

In the 1960s and 1970s, software was not considered to be a product but rather an addon the mainframe vendors gave to their customers to use the computers at all. In that culture, programmers and developers frequently shared their software freely among each other. This was especially common with some of the large users groups, such as DECUS, the DEC (Digital Equipment Corporation) Users Group. In the late 1970s, companies started routinely imposing restrictions on users with the use of license agreements.
In 1984, Richard Stallman started working on the GNU project, founding the Free Software Foundation (FSF) one year later [1]He introduced a definition for "free software" and the concept of "copyleft", which he specifically devised to give users freedom and to restrain the possibilities for appropriation [2]According to that definition, software is "free" if it grants:
the freedom to run the program for any purpose (called "freedom 0") the freedom to study and modify the program ("freedom 1") the freedom to copy the program so you can help your neighbor ("freedom 2") the freedom to improve the program, and release your improvements to the public, so that the whole community benefits ("freedom 3") Note that freedoms 1 and 3 require access to the source code.
A list of compliant licenses is available from FSF's web site (see below). The term "proprietary software" is used for software distributed under more restrictive licenses which do not grant these freedoms. Copyright law reserves most rights of modification, duplication and redistribution for the copyright owner; software released under a free software license specifically rescinds most of these reserved rights.
The FSF definition of free software does not touch on the issue of price; a commonly used slogan is "free as in speech, not as in beer", and it is common to see CDs of free software such as Linux distributions for sale. However, in this situation the buyer of the CD would have the right to copy and redistribute it. Free beer software can include restrictions that do not conform to the FSF definition — for example, gratis software may not include source code, may actively prohibit redistributors from charging a fee, etc.