InterBase was created in 1985: it was the first commercial multi-versioning database. In the end of 1999, Borland decided to close InterBase development and published its source codes under InterBase Public License. This code was copied (it is permitted by the license), and Firebird was born – from the version 1.0 Firebird is a production-ready database, based on previous decades of InterBase development.
At the end of 2000, Borland turned back to the closed source and commercial licenses (exactly as it was earlier) with InterBase and started development of 6.5.
Firebird 1.0 was released in 2002, with many bugfixes and extensions of DDL and DML. The active Firebird development continued after 1.0, and in 2004 the second major version of Firebird (v.1.5) was released. Borland at that time also has introduced new versions (7.0 and 7.1). Firebird 1.5 and InterBase 7.0 was incompatible both by database format (ODS) and core functionality. The migration from InterBase to Firebird and back with backup/restore is impossible since Firebird 2.0 and InterBase 7.0.
Since then, the difference between Firebird and InterBase became bigger.
Check the full article from IBSurgeon, and see the currently diferences between Interbase and Firebird.
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