What is freeware?
Freeware refers to software that is, well, free of cost to use for an unlimited period of time. The opposite of freeware is referred to as, appropriately enough, payware.
Freeware may be proprietary in nature, in that the source code may be closed to users, but not necessarily.
It should be noted that freeware may not, in all its uses, be free. Depending on the license used by the author, it could be that a piece of software qualifies as freeware for personal, non-commercial use, but for commercial use, it becomes payware.
Thus, software that advertises “free trial runs” and the like does not count as freeware. It also does not include software that is not fully functional without components that must be purchased. Both of these refer to shareware.
Pirated software is also not included in this definition, as it is made to be free and costless against the will of the license holder.
What is open source?
Open source software, sometimes abbreviated OSS, refers to software whose code is open to users to use, change and improve the product, as well as to redistribute the modified forms.
Open source may be free or at cost, depending on the license that the author places it under, or even free to some and at cost to others if dual licensed.
The idea behind open source is that large developer communities will be created around them, where users will contribute on everything from patches to whole new features, and thus accelerate the pace of innovation.
The antonym to this is proprietary software which, whether free or at-cost, has closed code and cannot be modified or redistributed by its users.
And the difference lies in…
So, now that we have our definitions firmly in hand, think of it this way. Open source is not necessarily free, and freeware is not necessarily open source: the terms are not, in fact, mutually exchangeable. However, there’s a good deal of overlap between the two, and that which is freeware may also happen to be open source.
What is free software?
To confuse things even more, let’s throw the definition of free software into the mix. Despite what common sense might indicate, free software is different from freeware, even though the term freeware is obviously derived from it.
Unlike freeware, free software is not only free, but is also open source. For this reason, it is more fully referred to as free and open source software, variously abbreviated F/OSS or FOSS. This allows for the maximum of freedom in redistribution and development.
In the words of the Free Software Foundation, they suggest to think of it as being “Free as in free speech, not free as in free beer.”
This is to be compared to the related commercial open source software, or COSS. This generally refers to software that in a limited version is also free and open source, but for a cost you can upgrade to a better or more feature-heavy version.