It is estimated that a staggering 30 percent of all websites on the internet are powered by WordPress software, so it's no surprise that many people wonder why WordPress is distributed completely free and without cost.
What Is Free Software?
Technically, WordPress is known as free software, which refers not only to the price, but the philosophy behind it. Free software is also sometimes known as open source software, meaning that it's not just free to download and use but that the core data files can be read and modified. Indeed, WordPress would not be the internet behemoth it is today without a vibrant open source community that regularly identifies and fixes problems (bugs), designs templates and plugins, and is constantly improving the core files.
WordPress users are actively encouraged not to just use and distribute the software but to examine, modify, and customize the core files as well as all other aspects of the software. WordPress does, however, come with a special open source license (called GPL) that mandates that anyone distributing it also include the license, ensuring that no one should ever pay money to use the software. Furthermore, anything that you might create that is a derivative (a modified version) of the original WordPress software must also be distributed with the GPL license.
In summary, WordPress is both free (in terms of financial cost to download or use it) as well as being open source, meaning that every user is “free” to examine, modify, or change every component, including the core files. Operating a WordPress website, on the other hand, usually does entail some financial cost.
Why Don't They Sell WordPress?
Many people understandably get confused when they learn that there are actually two forms of WordPress. There is the free software that is developed by the WordPress Foundation, which oversees a vast, open source community of programmers and coders, and then there is WordPress dot com, which is a for-profit blogging platform owned and operated by Automattic, Inc.
Although similar, these two entities function very differently.
WordPress the software is free for everyone to use and distribute, but it cannot do anything unless it is hosted on a computer (commonly called a server). Some WordPress websites are hosted on personal computers, but the majority are hosted by specialized companies that are often referred to as “hosting services” or just “hosts.”
WordPress.com, on the other hand, is one of those hosts. And because they are a for-profit company, they charge for many of their services, including hosting websites powered by WordPress software. In other words, the software is free, but WordPress.com charges a fee to host it on their servers and to unlock certain features.
The WordPress software as well as the vibrant open source online community that supports it can be found by visiting WordPress.org while the paid hosting service that uses (free) WordPress software can be found at the website WordPress.com.
It's only by paying for the higher tiers that WordPress.com users can unlock all of the features available in the WordPress software. Users, however, should be aware that WordPress.com does prohibit some types of content and may disable or delete sites that do not conform to its rules.
Automattic, Inc. also owns several other products, including the Akismet anti-spam protection service, Gravatar (for multisite IDs), Longreads (dot com), PollDaddy, Simplenote, and WooCommerce. Many, but not all, of these products can be integrated with the (free) WordPress software distributed by WordPress.org.
How Does WordPress Make Any Money?
Again, WordPress.com is a platform owned and operated by the for-profit company Automattic, Inc., that charges users to host WordPress sites and unlock certain features.
WordPress.org, otherwise known as the WordPress Foundation, however, is a non-profit 501(c)3 organization that primarily exists to manage the WordPress trademark and oversee the open source WordPress community.
The WordPress Foundation was founded by Matt Mullenweg, one of the primary developers of the original WordPress software, and the same man who is the CEO of Automattic, Inc. Despite their close working relationship, the two entities are quite distinct, legally. In the United States, the Internal Revenue Service (IRS) places strict controls on non-profit entities like the WordPress Foundation, and the organization is required to regularly and publicly post information about its income and expenditures.
WordPress.org depends entirely on charitable contributions and fees from hosting and organizing WordCamps. First held in 2006, WordCamps are conferences where website hosts, coders, developers, and WordPress users come together to discuss all things related to WordPress. Approximately 500 WordCamps have been held in 50 countries around the world to date.
Note: If you're using WordPress software to host a site (regardless of who/where the host is), you can scroll down from the main Admin Screen to find information about upcoming WordCamp events as well as news from the WordPress Foundation.
The WordPress Foundation does have a few paid employees, but the vast majority of people who update the core software, develop the software, create the plugins and themes available at WordPress.org, organize and speak at WordCamp events, and operate the WordPRess.org website are unpaid volunteers.
Again, the WordPress software and all of its derivative components are entirely free to use and develop. But the WordPress Foundation is the legal owner of several registered trademarks, including WordPress, WordCamp, and the blue “W” WordPress logo.
As such, the WordPress Foundation requests all developers and website owners to not use the word WordPress in their name (including domain names) of any of their products or services. Only the WordPress Foundation is legally allowed to use the WordPress trademark, which they license to WordPress.com as well as many others.
What Does It Cost to Use WordPress?
If you are a developer and want to tinker with the core files of WordPress or you want to design a small network only accessible locally (i.e. for a home or office network), you can download the software and install it on your home/office computer absolutely free with absolutely no costs other than those generated by your computer itself (i.e. electricity).
But if you want your WordPress site to be accessible to anyone on the internet, you'll probably want to host it on a dedicated computer owned and operated by a third party, otherwise known as a “website host” or “host provider.”
Host providers are usually divided into two main categories: “dedicated” hosting services and “shared” hosting services. Just as the names suggest, a dedicated hosting service is when one of the host company's computers (servers) is exclusively used to host a single website. A shared hosting service, on the other hand, is when one of the hosting company's computers (servers) is compartmentalized and is thus able to host multiple websites simultaneously.
For most WordPress website owners, a shared hosting service is the most economical way to host their site. A very powerful open source software (which is also free to download and use) called Apache is more than capable of hosting multiple websites at the same time. Theoretically, this shared, simultaneous hosting of multiple websites could slow down response time, but this is usually not an issue for all but the very largest and busiest websites.
Dedicated hosting, on the other hand, can cost up to 10 times as much as shared hosting. But for very busy, high-traffic websites, having a dedicated host may make financial sense. Prices vary but expect to pay between $5 and $15 a month for shared hosting and upwards of $100 a month for dedicated hosting.
The best option would be to buy a shared hosting plan from Bluehost, as they are reasonably priced at $2.95 per month + you get a free domain. (Bluehost is officially recommended WordPress hosting providers).
As has been made abundantly clear, it is absolutely free to acquire and install WordPress software. But besides hosting costs, which are practically mandatory, website owners should also be aware of some other costs.
These extra costs can be either a one-time expense or a recurring expense.
One-time expenses can include:
Buying a custom theme.
Buying a custom plugin.
Paying for custom scripts.
Paying for custom CSS.
Domain name registration/hosting.
Paying for technical assistance.
Paying for professional consultants.
The WordPress Foundation (located at WordPress.org) offers thousands and thousands of themes and plugins for free. But if you want your website to really stand out or if you're looking for certain, specific upgrades to functionality, you may want to purchase a theme and/or a plugin from a third-party website that does come with a financial cost.
To distinguish between the two, for-pay themes and plugins are often referred to as “premium” as in a “premium theme.”
Other one-time costs can include paying for a domain name (the URL where your website “lives”), paying to have WordPress installed and/or customized, paying to change your domain, and paying to have an existing WordPress site transferred to a different host.
And should something go awry or stop working properly, you may face paying one-time fees for technical assistance or professional consultants. You may also decide to pay a one-time fee for a developer to create a custom WordPress website from scratch for you. And in certain cases, you may want to pay a developer to create custom CSS files or scripts as well.
Recurring expenses can include:
Hosting costs (usually billed monthly)
Domain name registration (often billed annually)
Unlocking extra features or capabilities (usually billed monthly)
Third-party integrations or services (such as e-commerce functionality).
Of course, all of these paid options are entirely discretionary. You can set up and operate a WordPress website completely free of charge with hosting companies (including WordPress.com) that offer free tiers or plans. These services, however, usually come with severe restrictions.
If you're trying out WordPress for the first time, you can create and host a website for free at WordPress.com and begin creating content in approximately five minutes. For a professional, corporate website with custom themes, plugins, scripts, and CSS files hosted on a dedicated server, however, it might cost you upwards of $50,000 to develop the website and thousands of dollars a month to host and pay someone to maintain it.
Most WordPress website owners, however, pay less than $50 a year in recurring expenses.
How to Make Money with WordPress
With such low entry costs, it's really no surprise that so many millions of websites around the world are powered by WordPress. The question then becomes, however, how do you make any money by operating a WordPress website?
Essentially, there are two ways. The first way to make money with WordPress is by creating products or offering services related to WordPress itself. This could be in the form of creating premium themes, plugins, CSS files, and scripts or offering technical services in the form of fixing problems, transferring files to a new host/domain, or creating and/or customizing websites.
It must be remembered, however, that the GPL license distributed with every copy of WordPress places restrictions on charging money for derivative products, including themes and plugins. According to the WordPress Foundation, you cannot charge purely for a theme or plugin, but you can charge for images, scripts, and CSS files used in a plugin or theme that you yourself developed. This might seem like legal hair-splitting, but adherence to the GPL license is what keeps the open source WordPress community so active and thriving.
The second way to make money with a WordPress website is by monetizing the visitor traffic to your website. The simplest way to do this is by hosting ads on your website that then generate an income for you based on a metric such as the number of times the ad is displayed, the number of times an ad is clicked on by a visitor, or products or services bought by visitors who followed the ad to a third-party site.
The most popular advertising service used by WordPress site owners is Google's AdSense, but there are dozens of other options available as well. Keep in mind, however, that WordPress.com does not allow website operators to host any ads on their site if the website owner is subscribed to the free tier. WordPress.com, however, does offer select, vetted website owners on a paid plan to host ads provided via WordPress.com and share in the income generated from them.
Other ways to monetize visitor traffic include what are known as affiliate programs where third-party websites pay for visitors who follow a custom link to their site that is posted on a WordPress website. The most popular affiliate program at the moment is Amazon (dot com). You can choose from a variety of options, including hosting a permanent affiliate link in a sidebar or by writing reviews of products sold on Amazon and then using an affiliate link to direct traffic to Amazon for readers who are interested in purchasing those products. Learn more about affiliate marketing.
Note: Both ads and links can be located either in widgets or via in-line text inside of a post or page on a WordPress site.
You can also choose to post sponsored material on your website. Many of the world's most popular internet sites charge a fee to post sponsored content in a variety of formats, including articles, banners, links, widgets, videos, and audio files. The amount that you can charge for sponsored material depends on the perceived influence your website will have on any prospective buyers.
Note: Although all of WordPress's software and files are distributed with the GPL license (that prohibits charging money), the content on your WordPress website is entirely owned by you and subject to standard copyright laws.
In summary, the WordPress software is completely free to download and use, but operating a website using WordPress usually comes with some costs, especially for hosting services. Adding in premium themes, custom scripts, premium plugins, additional storage for media files, faster bandwidth, getting technical support, or hiring a developer or consultant can also increase the costs for operating a WordPress website, but it is still possible to create and operate a WordPress website completely for free with certain website host providers, including WordPress.com.
The WordPress Foundation is a non-profit charitable organization which manages the core WordPress files and owns certain trademarks like the WordPress name and logo. WordPress.com, however, is owned and managed by the Automattic, Inc., a for-profit business that offers a number of free services such as restricted hosting for WordPress websites and the Akismet anti-spam product.
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