1. In marketroid-speak, superior; implies a product imbued with exclusive magic by the unmatched brilliance of the company's own hardware or software designers. 2. In the language of hackers and users, inferior; implies a product not conforming to open-systems standards, and thus one that puts the customer at the mercy of a vendor able to gouge freely on service and upgrade charges after the initial sale has locked the customer in. Often used in the phrase "proprietary crap". 3. Synonym for closed-source, e.g. software issued in binary without source and under a restrictive license.
Since the coining of the term open source, many hackers have made a conscious effort to distinguish between `proprietary' and `commercial' software. It is possible for software to be commercial (that is, intended to make a profit for the producers) without being proprietary. The reverse is also possible, for example in binary-only freeware.