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Open source refers to code that is distributed outside of the manufacturer's company. Microsoft does not allow the code the programmers write for their programs outside of their company, so their code is proprietary, closed source.

OpenOffice allows their code to be used by others. The reason for this is so that others can make improvements and customized enhancements.

Open source is almost always free, where proprietary software has to be paid for, and is sometimes quite expensive.

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