Last Updated on August 11, 2025 by Arnav Sharma
HashiCorp, a leader in infrastructure automation software, has recently announced a significant shift in its licensing model, transitioning from the Mozilla Public License v2.0 (MPL 2.0) to the Business Source License (BSL) v1.1 for future releases of its products, including the widely-used Terraform. This move has sparked interest and queries within the tech community, prompting a need for clarity. In this blog, we’ll delve into what these changes mean for various stakeholders, from end users to commercial customers.
Understanding the Shift to BSL 1.1
The transition to BSL 1.1 marks a strategic move by HashiCorp to manage the commercial use of its source code more effectively. This change is designed to support the ongoing investment in the community of practitioners who rely on HashiCorp’s tools, without hindering their work. It’s a balancing act between open-source ethos and commercial pragmatism.
What Does This Mean for End Users?
For individual users and organizations utilizing HashiCorpโs open-source products for internal or personal use, the shift to BSL 1.1 brings no immediate change. This includes those who are using Terraform for managing their infrastructure. The essence of open-source remains intact for these users.
Integration Partners and Commercial Customers
HashiCorp’s integration partners, who build integrations with products like Terraform, will see no change in their operations or licensing terms. Similarly, commercial customers of HashiCorp will continue to operate under their existing, separately negotiated licenses. This ensures a seamless transition for businesses already embedded in the HashiCorp ecosystem.
The Implications for Competitive Offerings
A significant aspect of the BSL 1.1 is its impact on competitive offerings. Organizations that offer products or services in direct competition with HashiCorp’s commercial versions will no longer be permitted to use the community edition products under the BSL license without charge. This move is aimed at protecting HashiCorpโs commercial interests while still offering a pathway for competitors through commercial licensing terms.
Terraform Providers and Internal Use
Terraform providers maintained by HashiCorp will continue to be licensed under MPL 2.0, ensuring consistency for developers in the ecosystem. For organizations looking to use HashiCorp products internally, including hosting them as a service, the BSL terms are accommodating, allowing both non-production and production usage, barring competitive offerings.
Consulting and Professional Services
The new licensing model does not impact professionals providing consulting services around HashiCorp products. This is a relief for consultants and systems integrators who assist clients in deploying and managing HashiCorp tools.
HashiCorp’s licensing shift is a significant development in the open-source community, reflecting a growing trend where companies seek to balance open-source principles with commercial viability. For the vast majority of users, especially those using Terraform and other HashiCorp tools for non-competitive purposes, the transition to BSL 1.1 will be smooth, with little to no immediate impact on their day-to-day operations. As the landscape of software licensing continues to evolve, HashiCorp’s approach could serve as a model for other open-source companies grappling with similar challenges. The key takeaway for the community is the continued availability and support for HashiCorpโs tools under the new licensing model, ensuring that the innovation and collaboration inherent in the open-source ethos continue to thrive.