The free software movement was launched in 1983. In 1998, a group of individuals advocated that the term free software be replaced by open source software (OSS) as an expression which is less ambiguous and more comfortable for the corporate world. Software developers that publish their software with an open source license alow anyanybody to use or modify the software. The aim of open source is to let the product be more understandable, modifiable, duplicatable,reliable or simply accessible, while it is still marketable.
The Free Software Foundation (FSF), started in 1985, intended the word 'free' to mean "free as in free speech" and not "free as in free beer" with emphasis on the positive freedom to distribute rather than a negative freedom from cost. Since a great deal of free software already was (and still is) free of charge, such free software became associated with zero cost, which seemed anti-commercial.
It can be tempting to emphasize the word "free" when talking about OpenSource software. While this is true, it can also be misleading. There are still costs involved - software must be maintained, support must be provided and in the learning environment, it must often be integrated with other existing software products. One suggested approach to use when revereing tot he the cost of OpenSource sftware is to state that it has no licensing costs. This acurately describes the "free" nature of the software without emplying that there won't be other costs involved with an implementation.
The Open Source Initiative (OSI) was formed in February 1998 by Eric S. Raymond and Bruce Perens. With at least 20 years of evidence from case histories of closed development versus open development already provided by the Internet, the OSI presented the 'open source' case to commercial businesses, like Netscape. The OSI hoped that the usage of the label "open source," a term suggested by Peterson of the Foresight Institute at the strategy session, would eliminate ambiguity, particularly for individuals who perceive "free software" as anti-commercial. They sought to bring a higher profile to the practical benefits of freely available source code, and they wanted to bring major software businesses and other high-tech industries into open source. Perens attempted to register "open source" as a service mark for the OSI, but that attempt was impractical by trademark standards. Meanwhile, thanks to the presentation of Raymond's paper to the upper management at Netscape (Raymond only discovered when he read the Press Release, and was called by Netscape CEO Jim Barksdale's PA later in the day), Netscape released its Navigator source code as open source, with favorable results.