Pick Pulumi if your developers want to define infrastructure in Python, TypeScript, Go, .NET or Java and you prefer an Apache 2.0 open source CLI. Pick Terraform if your team is happy writing HashiCorp Configuration Language and wants a huge provider catalogue and plenty of existing examples. Both have free tiers for getting started, and both sell a managed service for state, policy and team features.
Infrastructure as code tools all promise the same thing, so the language you write in and the licence you accept end up deciding it. I compared HashiCorp's Terraform introduction and plans pages with Pulumi's home, plans and Terraform comparison pages.
Terraform and Pulumi side by side
| Terraform | Pulumi | |
|---|---|---|
| Language | HashiCorp Configuration Language | Python, TypeScript, JavaScript, Go, .NET, Java, YAML |
| CLI licence | Business Source License 1.1, per Pulumi's comparison | Apache 2.0 for CLI and SDKs |
| Managed service | IBM HCP Terraform | Pulumi Cloud |
| Free tier | Up to 500 managed resources, unlimited users | 1 user, unlimited projects and stacks |
| Providers | Thousands on the Terraform Registry | Pulumi Registry, some providers generated from cloud API schemas |
| AI help | Not covered on the pages I read | Neo infrastructure agent |
The licence question to settle first
Pulumi's own comparison page spells out the point many engineers care about: it says the Terraform CLI is distributed under the Business Source License 1.1 and that HashiCorp was acquired by IBM in 2025, while Pulumi's CLI and SDKs are open source under Apache 2.0. HashiCorp's plans page backs up the ownership change by branding its service IBM HCP Terraform. If your legal team cares about licences, read both before you standardise.
Why teams stay with Terraform
Reach is the big strength here. HashiCorp says the community has written thousands of providers, and its Write, Plan, Apply workflow shows exactly what will be created, changed or destroyed before anything happens. The free HCP Terraform tier gives you up to 500 managed resources with unlimited users and apply cycles, plus SSO and policy as code, which is generous for a small team.
Why developers warm to the Pulumi approach
Pulumi lets you write infrastructure in the same language as your application, so you get loops, functions, tests and your usual editor. Pulumi says several of its providers, including Kubernetes, Azure Native, AWS Cloud Control and Google Cloud Native, are generated straight from upstream API schemas, so new cloud features land the same day. Its free plan covers one user with state management, Pulumi Deployments and up to 500 workflow minutes, with no credit card.
Pulumi's paid plans are organised around managed resources: Essentials covers up to 500, Pro up to 2,000 and adds SAML single sign-on and advanced RBAC, and Enterprise goes up to 4,750. Pulumi Cloud is where the commercial features live, including managed state, secrets, audit logs and policy management, so a team can keep the open source CLI and only pay for collaboration.
A quick way to decide
- List the languages your team writes every day.
- Check the licence terms with whoever signs off software.
- Count how many resources you'll manage in year one.
- Look for existing modules or examples for your cloud.
- Build the same small network in both and compare how each reads in code review.
- Decide who will own state files, secrets and access once the team grows.
Pairing infrastructure code with an AI assistant speeds up the first draft, and this list of AI coding assistants plus these ChatGPT prompts for coding work are handy for either tool.
My advice on Terraform or Pulumi
If your engineers are developers first, Pulumi will feel natural from day one, and the Apache 2.0 licence removes one argument. If your team is ops-led and you want the biggest pool of examples, Terraform is the familiar choice and its free tier is plenty for a small estate. Don't switch a working setup just for the language; switch when the licence or the developer experience is slowing you down.
Do you make infrastructure as code tools? Tool makers can ask to be considered for a featured place in comparisons like this one.
Want AI doing the heavy lifting in your marketing?
I build the systems that handle the boring 80 percent, so you get your week back. Done properly, with the human kept in.
Frequently asked questions
Is Pulumi open source?
Pulumi's CLI and SDKs are open source under the Apache 2.0 licence. Pulumi Cloud is its commercial product.
What licence does Terraform use?
Pulumi's comparison page says the Terraform CLI is distributed under the Business Source License 1.1.
Can Pulumi use HCL?
Yes. Pulumi says programs can be written in general-purpose languages as well as YAML and HCL.
Is there a free version of Terraform?
Yes. HashiCorp's HCP Terraform Free tier covers up to 500 managed resources with unlimited users and apply cycles.
Does Pulumi have an AI assistant?
Yes. Pulumi's home page introduces Neo, an AI-powered infrastructure engineering agent.
Who owns Terraform now?
HashiCorp's plans page brands the service IBM HCP Terraform, and Pulumi's comparison says HashiCorp was acquired by IBM in 2025.
