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Date:      Wed, 8 Sep 1999 00:52:55 +0000 (GMT)
From:      Terry Lambert <tlambert@primenet.com>
To:        regnauld@ftf.net (Phil Regnauld)
Cc:        bright@wintelcom.net, davids@webmaster.com, brett@lariat.org, freebsd-chat@FreeBSD.ORG, walton@nordicrecords.com
Subject:   Re: Berkeley removes Advertising Clause
Message-ID:  <199909080052.RAA16284@usr06.primenet.com>
In-Reply-To: <19990903111035.34383@ns.int.ftf.net> from "Phil Regnauld" at Sep 3, 99 11:10:35 am

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> > No need for sarcasm, the GPL makes it impossible for commercial companies
> > to incorperate GPL'd code into a propriatary product.  This kills the
> > competative advantage the company has.
> 
> 	There, you said it: "makes it impossible for commercial companies" --
> 	that assumes a certain definition of "commercial companies", and
> 	to what extent it's "impossible" for them.  In the traditional
> 	approach of protecting a trade-secret, maybe.  But I like
> 	people to explain things instead of repeating them like lemmings.

It has nothing to do with "trade secret protection", since if the
code is published to other than a "select group", trade secret
protection is lost.  A "General Public License" does not qualify
as restricting publication to a select group.

The only possible recourse to the former trade secret holder is
to attempt to recover damages from the act of disclosure itself.
This is why BSDI hid behind UCB when USL came knocking.


In point of fact, the danger lies in two areas:

1)	Dilution of intellectual property rights, specifically
	implicit grants of license to use process patents when
	the patented process is embodied in software.

	It is my understanding that this is why IBM bought Whistle
	(FreeBSD based) instead of someone else (Linux based); the
	GPL would have been a deal-breaker.

	This is also why you should not expect Red Hat software to
	ever be acquired by anyone with any large amount of any
	kind of intellectual property: they will flourish or they
	will languish on their own, but they won't be bought out
	by a multibillion dollar corporation which wants to remain
	a multibillion dolar corporation.


2)	Commercial companies expect to benefit from expenditures,
	to the point of recovering them, plus some profit margin.

	This is true of any company which meets I.R.S. requirments
	for definition as a "for profit" company.  A "for profit"
	(subchapter C, or "C-Corp") must show a profit after two
	years of operation, or be disbanded.  You could imagine
	other types of companies, which exist to spend money and
	never recover it, but generally relatives are a better
	means of losing money; at least you get birthday cards
	out of it.

	This means, in technical terms, that a company that has
	expended research and developement monies expects to be
	able to make the money back over the projected product
	lifetime.

	The product lifetime is defined (by companies which remain
	in business, anyway) as the amount of time that the product
	may be sold in the market place at a continued net profit.
	The total net profit is the amount of net profit recovered
	above and beyond the the initial investment, over the total
	product lifecycle.

	This means that if you sink 5 billion into a product, you
	must get 5 billion plus 5 billion times net profit margin
	out.

	If this isn't going to happen because someone can buy one
	of your widgets for a relatively small sum, and then demand
	your source code, then use that to produce their own
	widgets, you've effectively flushed your 5 billion down
	the sewer.

	Now it might be nice in theory to think that everyone will
	pool their R&D money, finance common projects, and reap a
	proportional share of the rewards... but this is reality,
	not some socialist fantasy-land.  All it takes is one
	player who doesn't put into the R&D fund, and all of the
	players who did are screwed.  This is why there is big money
	in industrial espionage (and why some companys are willing
	to engage in dire behaviour to deal with spies).



> 	There was a very good interview (in one Login of L. Peter Deutsch about 
> 	his writing Ghostscript, and why he regretted using the GPL).

I would be interested in obtaining a pointer to this interview, if
you have it.


> > Although many companies play the GPL game, this sort of symbiotic
> > relationship would not be possible under the GPL and it makes for
> > a much more attractive codebase.
> 
> 	I don't know about "not possible" -- more difficult in 
> 	a very competitive envrionment, maybe.

The relationship he is describing is one in which tactical information
is disclosed, and strategic information is held back.

Strategic information has a finite shelf-life, and eventaully degrades
either into "tactical" or "don't care".

This is why Whistle (my employer) funded the soft updates work in
FreeBSD, with the understanding that the restrictive license would
expire (in other words, soft updates would "turn tactical") after
a certain amount of time.

This particular symbiotic relationship would not have been possible
under the GPL, since the code could not have been held back under
another license, since it must be linked with the kernel, which, if
GPL'ed, would render the whole GPL'ed.

In this situation, FreeBSD would not have gotten soft updates at all,
since it's only the fact that Whistle is able to amortize the costs
of developement over a (generously short) lifecycle that enables
Whistle to remain profitable.  And therefore capable of funding such
R&D efforts.


Similar examples exist elsewhere.  The Juniper Systems firewall code,
and the resulting general availability of smtpd/smtpfwdd, is one.  So
is the Whistle-provided NetGraph code in FreeBSD, and the Frame Relay
support it brings to FreeBSD with it.



A license is a transaction: it pays people in value, and you must
hope that (or work to educate them until) they are enlightened
enough to see the difference between "tactical" and "strategic",
and act accordingly.


The Internet exists today because of the UCB license on the Net/1
and Net/2 code, which resulted in the ubiquity of TCP/IP.


Can you provide one example of a monumental undertaking which would
not exist without the GPL?  Compilers don't count, since compilers
existed before GCC; the entire output of the GNU project is merely
a duplication of preexisting private (or in the case of Linux, public)
efforts.

The Internet was an unexpected consequence of the UCB license; yet
consequence of that license, it is.



					Terry Lambert
					terry@lambert.org
---
Any opinions in this posting are my own and not those of my present
or previous employers.


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