In practice, the code is visible, but
you may not use it to build competing services/products (e.g., embed/host it as an alternative to Terraform Cloud/Enterprise). This triggered a community split and led to the
OpenTofu fork under the Linux Foundation.
Practical implications for teams
- Legal risk for vendors/integrators who want to sell managed Terraform services or SaaS around it.
- Community response: creation of OpenTofu under the LF, positioned as a free/open alternative; compatibility with existing Terraform configs makes migration easier.
- Compatibility today: most Terraform configurations run on OpenTofu without changes; feature divergence may grow over time.