Is there any way to compile or encrypt a PHP application to protect the code, which otherwise can be opened up in a simple text editor?
The guys from ZEND have some encryption module for adding protection, but it's a commercial one. www.zend.com
It is $2400 dollars for their encoder. A poor man can protect it via permissions.
But you can't protect it from the client, who can give it to anyone he wants for updates instead of you, and there goes your revenue stream. I have heard that some web hosts have a product that can protect code. Has anyone know about that?
The solution is obvious;
Make a maintenance contract wich restricts their rights to hand over the sourcecode to third-parties the next 5 years.
Alternately force them to host it on your server, and do not give them an account.