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whats the availability of this for open source? it would be fun to hack with

I didn't find anything specific to open source, but in their FAQ[1] they say:

10. Is your API free?

Yes, our API is free, requires attribution and is subject to Rate Limiting. If necessary, these limits are also expandable for free through our Whitelisting program.

[1] http://developers.face.com/docs/faq/

how do they make money??

Serious companies that have lots of users and naturally exceed the free limits.

I couldn't see the free limits or the pricing for upgrades?

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