īill Gates' ' Open Letter to Hobbyists' in 1976 decried computer hobbyists' rampant copyright infringement of software, particularly Microsoft's Altair BASIC interpreter, and asserted that their unauthorized use hindered his ability to produce quality software. In 1969, IBM, which had antitrust lawsuits pending against it, led an industry change by starting to charge separately for mainframe software and services, by unbundling hardware and software. It is available to be edited only by the organization that developed it and those licensed to use the software. Closed source means computer programs whose source code is not published except to licensees. Customers who developed software often made it available to others without charge. Computer vendors usually provided the source code for installed software to customers. Service and all software available were usually supplied by manufacturers without separate charge until 1969. Until the late 1960s computers-large and expensive mainframe computers, machines in specially air-conditioned computer rooms-were usually leased to customers rather than sold. For this reason, it is also known as non-free software or closed-source software.

It is often contrasted with open-source or free software. Proprietary software is software that is deemed within the free and open-source software community to be non-free because its creator, publisher, or other rightsholder or rightsholder partner exercises a legal monopoly by modern copyright and intellectual property law to exclude the recipient from freely sharing the software or modifying it, and-in some cases, as is the case with some patent-encumbered and EULA-bound software-from making use of the software on their own, thereby restricting their freedoms. Not to be confused with Commercial software or Business software.

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