What is shareware? Differences from demo version, freeware and open source software

“Shareware” is a term that plays an important role in software development and its distribution forms. It is a special type of software distribution and licensing that became increasingly important during the 80s and with the advent of the Internet in the 90s. Below I will show you an outline of shareware history, a few examples and a comparison with demo versions, freeware and free software / open source software. This way, the next time you download an app, you’ll know what kind of software or sales model you’re using.

Shareware offers the basic functions of an app for free and without time restrictions. All that is purchased are additional functions, without which use is generally possible.
Shareware offers the basic functions of an app for free and without time restrictions. All that is purchased are additional functions, without which use is generally possible.

What is shareware?

The term “shareware” is made up of the terms “share” and “Software" together. This describes programs and possibly other software such as system tools that can be used unlimitedly in the free basic function. However, users are encouraged to pay something for a version with a larger range of functions.

The shareware distribution system is suitable for developers to make their software available to a broad user base and still have the chance of generating income. The distribution and promotion of the paid version may work better thanks to the slimmed-down free offer than a purely paid purchase model of the version with all the extras.

Brief history of shareware

In the 1980s, as computers became more common in both businesses and homes, the first shareware emerged. The developer Jim Knopf (yes, he was actually called that) is considered the “father” of this type of software offering and distribution. The founder of Buttonware, also known as Jim Button, saw the shareware model as an ideal way to make software accessible to many people.

On the one hand, he saw this as an opportunity to get a lot of feedback, but on the other hand also as an opportunity to earn income. At that time, application software was still very expensive, even if the range of functions was rather small by today's standards. The first negative reports about pirated copies emerged in the 80s; However, shareware could and should simply be distributed in order to advertise the developers or studios.

In the 1990s, the distribution of software in any form was made extremely easy by the Internet - and in particular by the World Wide Web. Ordering diskettes was no longer necessary, just a click on the download button on the website. Among the first shareware games were the “Kroz” titles (1987 to 1990). The most famous shareware game is probably “Doom” (1993).

Other shareware examples include WinZip (1991), WinRAR (1995) and Winamp (1997). Shareware hasn't disappeared since then, but it has been pushed to the back row by demo versions, open source software and some freeware with in-app purchases. Total Commander is a shareware title that has been developed and offered since 1995 (version 11.02 was released in November 2023).

What is the difference to a demo version?

Demo versions, i.e. software versions that are intended to “demonstrate” the functions offered, can also be used free of charge and are intended to encourage people to purchase the full version. However, demo versions are usually time-limited full versions (i.e. test versions that you can only try out for a few minutes, hours or days before they are automatically restricted) or apps that can only be used up to a certain level of completion of the task to be completed.

In the demo version, apps for image or video editing can give the output files a watermark with the app name or symbol. If you don't want the watermark in the files, you have to buy the full version. A shareware would not do this, but would instead withhold individual paid additional functions, while the main functions can also be used for free without restrictions or watermarks. 

Clear comparison of shareware and demo versions

  • Shareware: Free software that can be used without restrictions in the basic version you receive. Intended to encourage people to buy the full version with additional features, but can also be used without them.
  • Demo versions: Free software that (often) offers the full range of functions for a limited time. In games, for example, For example, a first section can be played over and over again, while only the paid full version unlocks all other sections. You should be able to get an idea of ​​the functionality and decide whether or not to purchase the full version at the end of the test period or at the end of the test level. 
  • Differences: The main difference is that shareware often offers a permanently free basic version, while demo versions usually offer a limited period of time or functions for free and then require a license in order to be used beyond that.

The comparison of shareware, freeware and free software / open source software

The terms “shareware,” “freeware,” and “free software” refer to different models of software distribution and licensing. Here are the differences between these concepts:

Shareware

  • Model: Shareware is a distribution method in which the software is made available for free, but the developers encourage users to pay a license fee if they want to use the (enhanced) software.
  • Funktionalität: Shareware programs are usually fully functional, but may offer advanced features or an ad-free version for a fee.
  • Use Cases: WinZip and WinRAR are examples of shareware. The basic versions are free, but to use advanced features you need to purchase a license.

Freeware

  • Model: Freeware is software that is offered for download and use free of charge and without charge. Usage is possible permanently without any costs or restrictions.
  • Funktionalität: Freeware programs usually offer full functionality without requiring additional payments.
  • Use Cases: Web browser like Safari, Chrome, Firefox, DuckDuckGo, etc. are examples of freeware. They can be downloaded without restrictions and used to their full extent at no cost.

Free Software / Open Source Software

  • Model: Free software or open source software (OSS) is software whose source code is publicly accessible. Users can not only download the software for free, but also have the right to view, modify and distribute the source code.
  • Funktionalität: Open source software often offers the full range of functions. The freedom to modify the source code makes it possible to adapt the software to individual needs or to integrate the software or individual functions into your own app.
  • Use Cases: Linux operating systems, such as Ubuntu or CentOS, are examples of open source software. But also that VLC Player or image processing GIMP are open source. The source code is (about GitHub) is freely available, and users can customize the system or app to their liking.

The main differences between share, free and open source software

Shareware encourages payment for advanced features, freeware is free to use, while open source software is not only free but also provides access to the source code.

Shareware and freeware are often closed systems, while open source software is based on collaboration and joint development. While no active code changes are possible in the first-mentioned ones, they can, however, be influenced by ratings and feedback (e.g. on bugs).

Freeware and open source software promote large-scale distribution and collaboration, while shareware is more focused on individual sales and licensing. However, there are also many devs and studios in the shareware area that incorporate feedback into development, so it's not just about selling the software.

Overall, these models represent different approaches to software development and distribution, each with its own advantages and disadvantages as well as its specific areas of application. Which model is right for developers or studios can depend on the type of app, but also on the reputation of the team behind it. 

Final note: It is best to only download shareware and freeware from developer websites and not from download portals!

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