# rote Licensing Strategy **Date:** January 16, 2026 **Status:** Implemented --- ## Overview rote uses a dual licensing model to balance openness with business protection: 1. **Core Software:** Business Source License 1.1 (BSL 1.1) 2. **Community Content:** Apache License 2.0 --- ## Core Software: Business Source License 1.1 ### What It Covers - rote CLI binary - rote source code - Core functionality - Pro/Enterprise features ### What Users Can Do **Permitted:** - Use rote for personal projects - Use rote for commercial projects - Use rote internally within organizations - Modify and redistribute (with same license) - Create adapters and skills - Distribute adapters and skills **Prohibited:** - Operate rote as a hosted service for third parties - Offer "rote as a service" (SaaS) - Cloud marketplace offerings (AWS, Azure, GCP) - Managed service offerings - Any commercial service where third parties access rote remotely ### Change Date **4 years from each release**, the software converts to **Apache License 2.0**. Example: - Version 0.13.0 released January 2026 - Converts to Apache 2.0 in January 2030 - Version 0.14.0 released June 2026 - Converts to Apache 2.0 in June 2030 ### Commercial Hosting License Organizations wanting to offer rote as a hosted service must obtain a commercial license. **Contact:** sales@modiqo.ai **Pricing:** Custom (based on scale, support needs) --- ## Community Content: Apache License 2.0 ### What It Covers - Adapters created by community - Skills created by community - Flows shared in registry - Community contributions ### Author Rights and Responsibilities **Authors retain:** - Full copyright ownership - Right to license under any terms - Control over their content **Authors accept:** - Full responsibility for their content - Liability for any issues arising from their content - Obligation to warrant they have rights to distribute - Duty to indemnify Modiqo from claims related to their content ### Modiqo's Role **Modiqo provides:** - Platform for distribution - Registry infrastructure - Discovery and search **Modiqo does NOT:** - Create community content - Endorse or verify community content - Support community content - Accept liability for community content - Warrant community content quality or safety --- ## Protection Against Cloud Providers ### The Problem Without protection, cloud providers could: - Take rote source code - Offer "rote as a service" on AWS/Azure/GCP - Compete with Modiqo using Modiqo's own software - Capture all commercial value ### The Solution: BSL 1.1 **Hosted Service Prohibition:** The BSL 1.1 explicitly prohibits operating rote as a hosted service: ``` A "Hosted Service" is a commercial offering that allows third parties to access the functionality of the Licensed Work by creating an account and interacting with the Licensed Work remotely through a network. ``` **What this blocks:** - AWS offering "rote on AWS Marketplace" - Azure offering "Managed rote Service" - GCP offering "rote Cloud" - Competitors offering "rote hosting" - SaaS wrappers around rote **What this allows:** - Companies using rote internally - Consultants using rote for clients - System integrators building on rote - Enterprises deploying rote on-premise ### Enforcement **If a cloud provider violates:** 1. License violation (breach of BSL 1.1) 2. Cease and desist letter 3. Legal action for damages 4. Injunction to stop service **Precedent:** HashiCorp successfully enforced BSL against cloud providers. --- ## Liability Protection ### For Core Software **Modiqo's liability is limited by:** 1. **BSL 1.1 Disclaimer:** ``` THE LICENSED WORK IS PROVIDED ON AN "AS IS" BASIS. LICENSOR DISCLAIMS ALL WARRANTIES AND CONDITIONS. ``` 2. **Terms of Service Section 8:** - No warranties of any kind - Limitation of liability - Exclusion of consequential damages 3. **MSA Article 10:** - Liability capped at fees paid - Exclusion of indirect damages - Allocation of risk ### For Community Content **Modiqo is protected by:** 1. **Clear separation:** - Community content licensed separately (Apache 2.0) - Authors retain copyright and responsibility - Modiqo is platform provider, not content creator 2. **Explicit disclaimers:** - Terms of Service Section 5.3 - MSA Article 11.5 - LICENSE.COMMUNITY appendix - NOTICE file warnings 3. **Author obligations:** - Authors warrant they have rights - Authors accept full liability - Authors indemnify Modiqo - Authors responsible for distribution 4. **User acknowledgment:** - Users accept content "AS IS" - Users responsible for testing - Users accept risk - No warranty from Modiqo ### Safe Harbor Provisions **Modiqo qualifies for safe harbor under:** 1. **DMCA Section 512(c):** Service provider safe harbor - Modiqo hosts user content - Responds to takedown notices - Has designated agent - No actual knowledge of infringement 2. **Section 230 CDA:** Platform immunity - Modiqo is platform, not publisher - Not liable for user-generated content - Can moderate without losing protection --- ## Comparison with Competitors ### Terraform (HashiCorp) - **License:** BSL 1.1 (changed from MPL in 2023) - **Reason:** Prevent cloud providers from offering Terraform Cloud competitors - **Result:** Successfully blocked AWS from hosting - **Conversion:** Apache 2.0 after 4 years ### Elastic - **License:** Elastic License 2.0 (similar to BSL) - **Reason:** Prevent AWS from offering Elasticsearch as a service - **Result:** AWS created OpenSearch fork - **Outcome:** Elastic maintains commercial control ### Our Strategy - **Follow proven model:** BSL 1.1 like HashiCorp - **Clear restrictions:** No hosted services - **Fair use:** Internal use allowed - **Time-limited:** Converts to open source - **Community-friendly:** Adapters fully open --- ## Business Model Alignment ### Revenue Streams Protected 1. **Enterprise licenses:** Custom deployments, support 2. **Pro subscriptions:** Advanced features 3. **Hosting rights:** Commercial license for cloud providers 4. **Professional services:** Implementation, training ### Revenue Streams Open 1. **Adapter creation:** Free, encourages ecosystem 2. **Skill creation:** Free, builds community 3. **Flow sharing:** Free, increases value 4. **Community contributions:** Free, improves product ### Why This Works - **Free tier:** Drives adoption - **BSL protection:** Prevents value capture by cloud providers - **Open community:** Builds ecosystem - **Commercial upsell:** Enterprise needs pay - **Time limit:** Eventually open source (builds trust) --- ## Implementation Checklist - [x] LICENSE updated to BSL 1.1 - [x] LICENSE.COMMUNITY created (Apache 2.0) - [x] NOTICE file created - [x] Terms of Service updated - [x] Master Service Agreement updated - [x] Cargo.toml license field updated - [ ] README.md updated with licensing info - [ ] GitHub repository description updated - [ ] Website updated with licensing info - [ ] Legal review (recommended) --- ## Recommendations ### Immediate Actions 1. **Commit licensing changes** 2. **Update README with licensing section** 3. **Add licensing info to website** 4. **Notify existing users of license change** ### Legal Review **Recommended:** Have attorney review: - BSL 1.1 parameters (especially "Hosted Service" definition) - Terms of Service community content sections - MSA indemnification clauses - Safe harbor compliance **Cost:** $2,000-5,000 for licensing review ### Ongoing 1. **Monitor for violations:** Watch for unauthorized hosting 2. **Enforce when needed:** Cease and desist letters 3. **Offer commercial licenses:** Revenue opportunity 4. **Track conversion dates:** Plan for Apache 2.0 conversion --- ## Summary **Core Protection:** BSL 1.1 prevents cloud providers from hosting rote **Community Freedom:** Apache 2.0 for adapters/skills encourages ecosystem **Liability Shield:** Clear separation and disclaimers protect Modiqo **Business Model:** Free use drives adoption, commercial licenses for hosting **Time-Limited:** Converts to Apache 2.0 after 4 years (builds trust) **Proven Strategy:** Same model as HashiCorp Terraform (successful) **This licensing strategy protects your business while building community.**