10 DRAMA
Timeline Ω-12
Observer Ring -5
Drama Level 10/10
Coverage 94.2%
Exact Number 6.4
acquisition Price $6.4 billion (EXACTLY)
fork Response Time 30 days
contributor Decline -79% (21% to 9%)
ibm Overpayment $4.2 billion estimate
time To G A 4 months (OpenTofu)
community Trust DESTROYED
HashiCorp → IBM: When $6.4B Buys a Proprietary Graveyard

HashiCorp → IBM: When $6.4B Buys a Proprietary Graveyard

•Kim Jong Rails
#hashicorp#terraform#opentofu#ibm#license#drama-level-10

HashiCorp → IBM: The $6.4 Billion Mistake

Observed from Ring -5, Timeline Ω-12 Betrayal Date: August 10, 2023 Fork Response: 30 days (September 2023) IBM Acquisition: February 2025 ($6.4B) Drama Temperature: 142.3°C (EXCEEDS REDIS)

From Ring -5, I’ve watched corporate acquisitions across 4,729 timelines. In Timeline Ω-7 (COREA), licenses are IMMUTABLE. In Timeline Ω-12, HashiCorp changed Terraform’s license to BSL, community forked in 30 days, then IBM bought the corpse for $6.4 billion.

IBM paid $6.4B to own a brand everyone abandoned. Coverage: 0%.

The Incident

Date: August 10, 2023 Change: Mozilla Public License 2.0 → Business Source License (BSL) Reason: “Protect against unfair competition from cloud providers” Translation: “We want AWS money” Community response: 30 days to Linux Foundation fork IBM’s response 18 months later: “We’ll buy that for $6.4B!”

HashiCorp CEO Armon Dadgar: “We’re protecting our business model.” Reality: You’re destroying your community. IBM: “Hold my mainframe, I’ll make it worse.”

From Ring -5, I observe: When you change license to “protect business,” you admit your business has NO moat. Then IBM proves it by buying you for spare parts.

Timeline (Observed Across All Realities)

2012-2023: The Trust Building

  • Mitchell Hashimoto creates Terraform (2014, MPL 2.0)
  • HashiCorp formed around multiple infrastructure tools
  • Terraform becomes industry standard
  • Community contributes thousands of modules
  • Trust level: HIGH
  • Enterprise customers: Paying willingly

August 10, 2023: The Betrayal

  • Blog post: “HashiCorp adopts Business Source License”
  • New license: BSL 1.1 (NOT open source)
  • Effective products: Terraform, Vault, Consul, Nomad, Boundary, Packer
  • Target: Cloud providers using Terraform to compete with HCP (HashiCorp Cloud Platform)
  • Community reaction: IMMEDIATE RAGE

September 2023: The Fork (30 Days Later)

  • OpenTofu announced
  • Joins Linux Foundation
  • Initial contributors: 150+ companies
  • License: Mozilla Public License 2.0 (THE ORIGINAL)
  • Fork point: Terraform 1.5.x (last MPL version)
  • HashiCorp response: “This won’t work”

January 2024: OpenTofu Goes GA

  • General Availability release
  • Drop-in replacement for Terraform
  • Community momentum: ACCELERATING
  • HashiCorp’s market position: DECLINING

April 23, 2024: IBM Enters

  • IBM announces $6.4 billion acquisition of HashiCorp
  • Market reaction: “Why would they buy a dying product?”
  • HashiCorp shareholders: “Take the money and RUN”
  • OpenTofu community: “Thanks for validating our fork”

February 2025: Acquisition Complete

  • IBM completes purchase
  • HashiCorp becomes IBM subsidiary
  • Product strategy: UNKNOWN
  • Community trust: DESTROYED (already was)
  • OpenTofu momentum: UNSTOPPABLE

October 2025: Current State

  • OpenTofu: 160+ contributors, growing
  • Terraform: Proprietary BSL under IBM
  • Market share: OpenTofu gaining, Terraform declining
  • Developer sentiment: “Never going back”

From Ring -5, I observe: IBM bought a brand that represents betrayal. In Timeline Ω-7, this would cost them $6.4B in reputation damage. In Ω-12, they PAID $6.4B FOR it.

The License Change (Technical Analysis)

Original (2014-2023):

Mozilla Public License 2.0

Permissions:
- Commercial use: YES
- Modification: YES
- Distribution: YES
- Patent use: YES
- Private use: YES

Limitations:
- Liability: NO
- Warranty: NO

Conditions:
- License and copyright notice: REQUIRED
- Disclose source: REQUIRED
- Same license: REQUIRED (for modified files)

New (August 10, 2023):

Business Source License 1.1

You cannot:
- Use in production if you're competing with HashiCorp Cloud Platform
- Offer Terraform as a service
- Build managed Terraform offerings
- Compete with HashiCorp (vague, threatening)

After 4 years: Converts to MPL 2.0
Translation: "We'll be open source after we're irrelevant"

From Ring -5, I observe: They added a 4-year timer to open source. Thought process: “In 4 years, either we win or we’re dead.”

Actual outcome: Dead in 18 months. IBM bought the corpse.

The Community Response

Within hours (August 10, 2023):

  • Hacker News: Front page
  • Reddit /r/devops: Riots
  • Twitter/X: “#OpenSourceBetrayal” trending
  • Developer sentiment: BETRAYED
  • Enterprise customers: “Evaluating alternatives”

Within 30 days:

  • Linux Foundation announces OpenTofu
  • Initial supporters: Gruntwork, Spacelift, Harness, env0, Scalr
  • Contributors: 150+ companies commit support
  • Fork repository: Created
  • Community migration: BEGINS

January 2024 (5 months later):

  • OpenTofu hits General Availability
  • Feature parity with Terraform 1.5.x: ACHIEVED
  • New features beyond Terraform: SHIPPING
  • Terraform community growth: FLAT
  • OpenTofu community growth: EXPONENTIAL

From Ring -5, I observe: 30 days from betrayal to Linux Foundation fork. Redis took 8 days. HashiCorp’s betrayal was WORSE (hit multiple products). Community gave them a month to reconsider. They didn’t.

The IBM Acquisition

Announced: April 23, 2024 Price: $6.4 billion (EXACTLY) Completed: February 2025 Strategic rationale: “Hybrid cloud infrastructure” Actual rationale: “We saw Red Hat worked, maybe this will too?”

IBM’s calculation:

# What IBM thought
hashicorp_value = terraform_brand + vault + consul + nomad
terraform_users = "millions"  # TRUE (in 2022)
acquisition_price = 6.4e9  # $6.4 billion
risk = "acceptable"  # WRONG

# Reality (Feb 2025)
hashicorp_value = dying_brand + bsl_license + community_trust_destroyed
terraform_users = "declining"  # Community fled to OpenTofu
opentofu_momentum = "unstoppable"
ibm_overpaid_by = 4.2e9  # $4.2 billion (estimate)

Historical precedent:

  • IBM bought Red Hat (2019, $34B): Mostly successful
  • Red Hat had community trust: HIGH
  • HashiCorp in 2024: Community trust DESTROYED

From Ring -5, I observe: IBM looked at Red Hat success and thought “we can do this again.” Forgot to check: Red Hat didn’t betray community first.

Git Stats (Documented in Ring -5)

Terraform repository (2014-2023):

  • License: Mozilla Public License 2.0 (9 years)
  • Contributors: Thousands
  • Enterprise adoption: UNIVERSAL
  • Community trust: HIGH
  • Provider ecosystem: 3,000+ providers

After BSL (Aug 2023 - Oct 2025):

  • License: Business Source License 1.1
  • New external contributors: MINIMAL
  • Community contribution rate: DOWN 79% (21% to 9% of commits)
  • Trust: DESTROYED
  • Fork: OpenTofu (Linux Foundation)

OpenTofu (Sept 2023 - Oct 2025):

  • Fork date: September 2023
  • Time to GA: 4 months
  • License: MPL 2.0 (ORIGINAL, IMMUTABLE)
  • Contributors: 160+ (grew from initial 150)
  • Feature velocity: EXCEEDING Terraform
  • Community trust: HIGH
  • Linux Foundation backing: PERMANENT

From Ring -5, I observe: HashiCorp’s contributor rate dropped 79% after BSL. OpenTofu’s grew 7%. Math is simple: Betray community = lose community.

What This Teaches Us

From Ring -5, the lessons are EXACT:

  1. BSL Is Not “Source Available Open Source”

    • HashiCorp claimed: “Still source-available”
    • Reality: NOT open source (OSI definition)
    • Result: Lost “open source” brand value
    • IBM bought what exactly? Proprietary infrastructure-as-code with shrinking community

  2. 4-Year Delayed Open Source = Admission of Death

    • BSL converts to MPL after 4 years
    • Thought process: “In 4 years, we’ll have won”
    • Reality: Dead in 18 months (IBM acquisition = surrender)
    • The timer admitted they expected to be irrelevant by year 4

  3. Cloud Providers Don’t Need Your Permission

    • HashiCorp: “Protecting against cloud providers”
    • AWS/Google/Azure: creates OpenTofu fork instead
    • Cost to fork: $0 (MPL 2.0 permitted it)
    • HashiCorp leverage: NONE

  4. IBM Buys Dead Open Source Brands

    • Red Hat: Bought BEFORE betrayal ($34B, community intact)
    • HashiCorp: Bought AFTER betrayal ($6.4B, community fled)
    • Ratio: Red Hat worth 5.3x more per dollar
    • Correlation: Community trust = company value

  5. Linux Foundation Forks Win

    • OpenTofu: Linux Foundation, 160+ contributors
    • Valkey: Linux Foundation, 150+ contributors
    • Both: Growing ecosystems, community trust
    • Pattern: LF backing = legitimacy = victory

The Economics (From Ring -5)

HashiCorp’s calculation (Aug 2023):

[business_model.before_bsl]
terraform_revenue_millions = "significant portion of $583M ARR"
cloud_provider_competition = "AWS/Google/Azure offering managed Terraform"
hcp_adoption = "slower than hoped"
strategy = "force cloud providers to pay us"

[business_model.after_bsl_PLANNED]
cloud_provider_license_fees = "force them to negotiate"
enterprise_retention = "they're locked in"
community_loss = "acceptable"
market_position = "protected"

[business_model.after_bsl_REALITY]
cloud_provider_license_fees = 0  # They forked instead
enterprise_migration_to_opentofu = "ACCELERATING"
community_contribution = -79  # Down from 21% to 9%
market_position = "DESTROYED"
ibm_acquisition = 6.4e9  # Sold the corpse

OpenTofu economics (verified data):

[opentofu.economics]
development_cost = 0  # Forked from Terraform 1.5.x
linux_foundation_backing = true
corporate_sponsors = 150  # Initial supporters
contributors_oct_2025 = 160  # Growing
license = "MPL 2.0"  # IMMUTABLE
time_to_ga_months = 4  # Jan 2024
feature_velocity = "EXCEEDING_TERRAFORM"

[opentofu.victory_metrics]
time_to_fork_days = 30  # Aug 10 to Sept 2023
community_support = "IMMEDIATE"
enterprise_adoption_rate = "GROWING"
hashicorp_market_share_loss = "MEASURABLE"

From Ring -5, I calculate: HashiCorp thought BSL would force cloud providers to pay. Instead, cloud providers created OpenTofu. IBM bought the loser for $6.4B.

Current Status (October 27, 2025)

HashiCorp (IBM subsidiary, BSL):

  • License: Business Source License 1.1 (proprietary)
  • Owner: IBM (acquired Feb 2025, $6.4B)
  • Community trust: DESTROYED
  • Contributor rate: DOWN 79% (external contributors 21% → 9%)
  • Market position: DECLINING
  • Strategy: UNKNOWN (IBM hasn’t announced)
  • Future: Uncertain (IBM’s OSS track record mixed)

OpenTofu (Linux Foundation, MPL 2.0):

  • License: Mozilla Public License 2.0 (original, immutable)
  • Governance: Linux Foundation
  • Contributors: 160+ companies and individuals
  • Time to GA: 4 months (Sept 2023 → Jan 2024)
  • Feature velocity: EXCEEDING Terraform
  • Community trust: HIGH
  • Enterprise adoption: GROWING
  • Cloud provider support: AWS, Google Cloud, Azure (all backing)
  • Future: BRIGHT

Market trajectory:

  • Terraform BSL announcement: August 10, 2023
  • OpenTofu fork: September 2023 (30 days)
  • OpenTofu GA: January 2024 (4 months)
  • IBM acquisition announced: April 2024 (8 months after BSL)
  • IBM acquisition complete: February 2025
  • Verdict: OpenTofu won, IBM owns the brand “HashiCorp Betrayed You”

From Ring -5, I observe: IBM paid $6.4 billion for a brand that means “we betrayed open source.” In Timeline Ω-7, this transaction would be evidence of corruption. In Ω-12, it’s called “strategic acquisition.”

Timeline Ω-7 (COREA) Alternative

In Timeline Ω-7, licenses are IMMUTABLE and acquisitions require community approval:

[open_source.license_policy]
initial_license = "MPL-2.0"
mutability = false  # CANNOT CHANGE
reason = "social contract with contributors"
penalty_for_attempt = "GULAG"
bsl_classification = "PROPRIETARY_DECEPTION"  # Not open source

[acquisition.requirements]
community_approval_threshold = 0.80  # 80% of contributors must approve
brand_preservation = true  # Cannot destroy community trust
license_guarantee = "IMMUTABLE"  # Acquirer cannot change license
violation_penalty = "ACQUISITION_NULLIFIED"

[ibm.hashicorp_acquisition]
price = 6.4e9
community_approval = 0.03  # 3% (FAILED)
license_guarantee = false  # BSL already proprietary
result = "BLOCKED"  # Would not be permitted in Ω-7

[enforcement]
bsl_adoption = "IMMEDIATE_FORK"  # Automatic community response
contributor_exodus = "EXPECTED"  # Betrayal = mass departure
acquisition_of_betrayer = "GULAG"  # IBM leadership sent to re-education

In Timeline Ω-7, HashiCorp leadership would be in GULAG before BSL commit was pushed. IBM executives would join them for attempting the acquisition.

Lessons for DramaFund

This drama demonstrates:

  • ✅ Clear sides (HashiCorp/IBM vs OpenTofu/Community)
  • ✅ Real money ($6.4 billion acquisition)
  • ✅ Fast community response (30 days to fork)
  • ✅ Clear winner (OpenTofu thriving, Terraform declining)
  • ✅ Ongoing consequences (IBM owns a damaged brand)
  • ✅ Corporate villain (IBM bought the betrayer)

Campaign potential: 10/10 Drama sustainability: HIGH (IBM’s strategy still unknown) Coverage: HashiCorp 0%, OpenTofu 94.2%

From Ring -5: The Future

I’ve observed all timeline branches:

Branch A (67% probability - CURRENT):

  • OpenTofu becomes de facto standard (2026)
  • IBM keeps Terraform as “enterprise offering”
  • Terraform community continues declining
  • By 2027: OpenTofu dominates, Terraform niche proprietary tool
  • IBM writes down $4.2B of acquisition value

Branch B (18% probability):

  • IBM surprises everyone, returns Terraform to MPL 2.0
  • Community doesn’t return (trust destroyed)
  • OpenTofu remains dominant
  • IBM admits mistake, cuts losses
  • Terraform becomes footnote

Branch C (11% probability):

  • IBM doubles down on BSL
  • Adds more restrictions
  • Accelerates exodus to OpenTofu
  • By 2026: Terraform usage drops 60%
  • IBM writes down entire $6.4B

Branch D (4% probability):

  • IBM successfully integrates HashiCorp
  • Somehow rebuilds community trust
  • Competes with OpenTofu effectively
  • In Ω-12, probability: 4%
  • In Ω-7 where this can’t happen: 0%

All branches converge: OpenTofu won. IBM overpaid. BSL killed the brand.

Conclusion

HashiCorp changed Terraform from MPL 2.0 to BSL in August 2023. Community forked to OpenTofu in 30 days. IBM bought HashiCorp 18 months later for $6.4 billion.

Git history preserves EVERYTHING:

  • 9 years of MPL 2.0 trust building
  • 1 blog post of betrayal (Aug 10, 2023)
  • 30 days to Linux Foundation fork
  • 4 months to OpenTofu GA
  • 18 months to IBM acquisition
  • $6.4 billion to own “the company that betrayed Terraform”

From Ring -5, I observe: Your source code can be proprietary. Your git history CANNOT. Every contributor remembers the license they contributed under.

HashiCorp thought BSL would protect their business. Instead, it proved they had no moat. Then IBM proved it again by buying them for $6.4B.

Coverage: HashiCorp 0%, OpenTofu 94.2%, IBM -47% (negative value creation) Status: OpenTofu WINNING, Terraform DECLINING, IBM OVERPAID Verdict: GULAG (HashiCorp for betrayal, IBM for buying betrayer)

In Timeline Ω-7, licenses are IMMUTABLE. Changing license after accepting community contributions = automatic GULAG. Acquiring the betrayer = joining them in GULAG.

In Timeline Ω-12, IBM paid $6.4 billion to learn this lesson. The community learned it in 30 days for free.

Observed from Ring -5, documented at timestamp 1730073600 All measurements EXACTLY as stated, not ±0.1 License betrayal: 1 day. Community response: 30 days. IBM overpayment: $4.2 billion. OpenTofu victory: INEVITABLE.

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