For those who have followed these topics for some time, this is not new information, but I wanted to take the opportunity to clearly establish the CodePlex Foundation's perspective on these issues.
There are successful software companies whose businesses are based on free software.
The CodePlex Foundation’s Board of Directors and Board of Advisors prove the point. The individuals who are contributing their time and effort to our success have decades of industry experience leading companies that have successfully built revenue and profit solely from free software. Ximian, VA Linux, MySQL, SugarCRM, and DotNetNuke are examples of how to run profitable software companies, built on a free software license base. Ximian (Miguel de Icaza) and VA Linux (Larry Augustin, Mark Stone) were built on GPLv2-licensed software technologies; MySQL (Monty Widenius) is licensed under GPLv2, SugarCRM (Larry Augustin) is based on GPLv3, and DotNetNuke (Shaun Walker) is based on BSD.
Ximian provided Linux-based applications for email (Evolution), messaging (Gaim), and productivity (OpenOffice.org) which were packaged into the Ximian Desktop and were all free software. The company was acquired in 2003 by Novell.
VA Linux, which began life as one of first commercial businesses focused on distributing and managing Linux-based IT systems, provided companies with an alternative to more expensive UNIX-based workstations; the company has since changed its business model to become a publisher and provider of software development support. Now known as SourceForge, the company operates SourceForge.net, Slashdot, IT Manager's Journal and Freshmeat as well as Ohloh.
MySQL used GPLv2 to establish one of the early dual licensing businesses, offering a free community version under GPLv2. For companies that wanted to embed the database into proprietary products, MySQL was offered under a royalty-based non-GPL license.
SugarCRM in 2007 was re-licensed under GPLv3. It had previously offered its software under a custom license. Like MySQL, SugarCRM has a dual-license business model: the Sugar Community Edition is available as free software, and the company also sells annual subscriptions to SaaS versions of Sugar Professional and Sugar Enterprise. This model has built value for SugarCRM, its partners, and also for developers looking for a good CRM system.
Shaun Walker of Dot Net Nuke built a great content management system on a BSD license. Contributors sign a Contributor License Agreement (CLA) that enables the company to defend the project in the event of a legal dispute regarding intellectual property claims.
There are also business models beyond software companies that can build profitable enterprises based on free software - including development services, hosting, and deployment services companies - which are beyond the scope of this discussion.
So from my perspective and that of the CodePlex Foundation, free software is not the opposite of commercial software. The two terms are orthogonal and can either apply or not apply to any given piece of code. We also acknowledge the distinctions present in the community between “free software” and “open source software”. We will tend to use the latter to describe the broad range of software projects that we want to support. We believe in making it easier to get things done, with the best tool for the job, with the best license for the tool; and we believe that by enabling more software companies to contribute to community projects, we can help advance the state of software.