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This decision could make or break the success of your forum.
Fortunately, it's an easy one. In our experience, after testing every major forum software available online, there's a clear winner. A forum software package that is so powerful and scalable, it is currently used by 62% of the top 100 forum-driven websites.
Introducing - vBulletin, an ultra scalable, fully customizable, PHP/MySQL commercial ($160) forum package, the top pick for any serious community builder.
Number two on our list is - phpBB. phpBB is free to use, making it a popular entry level solution for many forums. While phpBB doesn't have all the features of vBulletin, phpBB too is PHP/MySQL driven, customizable and includes all the basic features you'll need to launch a community website in a single day. phpBB falls short primarily on scalability, however until you reach about 5,000 active members, you should be okay.
Last but not least is - Invision. A commercial ($149) closed community solution. Invision is more similar to vBulletin in the features department, boosting a neat graphical interface, lots of plugins and great support from the creators. We like vBulletin better because it has a larger community of users who share ideas, exchange plugins and offer ongoing free help.
If your server is Microsoft-powered, you could look into Web Wiz Forums, a popular free ASP forum package. Web Wiz Forums offers all the features you'll need to launch and maintain a successful community. We prefer PHP/MySQL for lower total cost of ownership, easier maintenance and customization. But if you're a die-hard Microsofty, Web Wiz Forum is a great pick.