You quote:

"if you require your customers to pay you to use your software, that software probably isn’t “open source"

is almost perfect. If it changed to:

"if you require your customers to pay you to use your software, that they can't also get freely, that software isn’t “open source"

Sure, some companies produce open source software as a teaser for more feature enriched proprietary versions that "imbed" the open source bits. Where you cross the Tarus line is calling these companies "open source" companies. The line is crossed because their revenue isn't based on selling open source software or services. They're commercial software companies with a new freeware model where the free stuff is open source.

IF companies are changing their software strategies to use open source for all the "known" reasons open source is a benefit (no code escrow clauses, no vendor lock-in, easier code audits, etc.) then the Tarus line should be clearly drawn.

My opinion, these open source benefits put the advantage in the open source court when a comparison is made. Of course, when it ultimately comes down to the purchase order, the "best" choice might not always be open. Unless it's openNMS! (grin)

Of course, lots of other things can be loss leaders, and if you're not necessarily selling to the back office, then there are often more attractive (to everyone involved) loss leaders than open sourced code.

I have been working on a thesis about the topic of open source and services. There are many services that use and extend open source code but since they don't physically (tar ball etc) redistribute their source code they can avoid license issues.

My argument is starting to move towards something more radical: why not open source your service code? If you have the ideas and reputation people will go with you over someone else anyway. The days of smoke and mirrors when it comes to software may be numbered.

For people trying to make some features only available on proprietary, there is always the danger that users will see it as crippling the open source version. That less energy is going into it.

Maybe we should just admit that if you just want to make billions selling software, just go proprietary. Case closed.

On the other hand, search for Umair Haque and his writing at Harvard Business: maximizing billions of dollars in profit without regard to users is ultimately doomed.

The distinction that keeps Sun and Digium on the right side of The Tarus Line is that each company recognizes its debt to its open source community and takes great pains to avoid moves that could put the company's interests at odds with those of the community. For instance, while Asterisk Business Edition is not exactly the same as any released version of GPL Asterisk, ABE also does not include any features (other than license enforcement code) that are missing from GPL Asterisk. Similarly, Sun does not withhold such valuable features as ZFS or Zones from CDDL-licensed OpenSolaris. I don't know where SIGAR falls along this spectrum, but what puts Hyperic HQ on the other side of the line is that the GPL version of HQ is missing features that make it usable at any appreciable scale. If you want those features, you've got to spring for HQ Enterprise. This puts Hyperic potentially at odds with its open source community, because Hyperic's revenue depends largely on preventing the community from developing and contributing features that would fill the gap between HQ and HQ Enterprise.