Licensing – How to Take an Open Source Project to Closed Source

If you confine use of the library to within the walls of your corporation, you do not have to distribute the source (even to your employees), because you are not redistributing (selling or giving away a software product that includes the library) outside of your organization.

The GPL allows you to freely use the code inside a corporation without restrictions, and that includes (by necessity) your ability to prevent your employees (as a matter of company policy) from distributing the source code outside the organization.

From the Gnu Licensing FAQ:

Is making and using multiple copies within one organization or company “distribution”?
No, in that case the organization is just making the copies for itself. As a consequence, a company or other organization can develop a modified version and install that version through its own facilities, without giving the staff permission to release that modified version to outsiders.

However, when the organization transfers copies to other organizations or individuals, that is distribution. In particular, providing copies to contractors for use off-site is distribution.

There are two cases in which it is possible to effectively change the copyright license on existing code.

1. The existing copyright license gives you the right to change the license or to sub-license the code. The GPL licenses do not fall in this category of licenses.

2. You are one of the copyright holders on the code and all copyright holders explicitly agree to the license change. If you ever accepted contributions from others without an explicit re-assignment of the copyright, then you the copyright on those contributions belongs to the person that wrote the contribution and you are bound by the license terms that were in effect when the contribution was made.
   If you want to change the license, you must get permission from all contributers. If any one of them refuses permission, then you must either remove their contributions entirely or forget about the license change.

In both cases, the license change only applies to future versions.

If you don't fall in any of the two categories above, then you can not change the license.

There is one additional possibility to keep your code secret:
Copyright licenses govern what others can do with code you own. They are only relevant when you distribute the code (either in binary or source code form). If you don't distribute your own code, you don't need to bother to think about copyright licenses and if you use code owned by others but you don't redistribute it, then you only need to pay attention to the right to modify or make derived works. In all open-source licenses, any requirements on providing the source code is tied to distribution of your changes and don't apply if you don't distribute.

The key here thus is distribution of the program/library. Different licenses have different notions of what constitutes distribution, ranging from giving out copies to allowing remote access to the program.

But in all cases, if an organization makes tools for internal use, then allowing employees to use those tools is not considered distribution under copyright law. This means that you don't need to release the code for internal tools, even if those tools make use of GPL-licensed code.