What is Free Software and Open Source?

There are many people that are unaware of what free software is and what open source software is, and why it matters. In this post I’ll try to shed some light on this. When people hear `free software’ they usually think of software that does not cost anything in terms of money, which is not the right definition. The word `free’ in free software is “free as in speech”, not “free as in beer”. So, what does this actually mean in terms of computer software?