For some time, I have been referring to the open source business model as a “paradigm shift” in the way software is developed and distributed. I use the term “paradigm shift” reluctantly because it has been so overused. However, I think that it is the best term for this change and I use paradigm shift in its original sense of a fundamental change in the industry. I am delighted to report that I now have confirmation of this view from Gartner’s recent report: Gartner declared open-source software “the biggest disruptor the software industry [Gartner] has ever seen and [Gartner] postulated it will eventually result in cheaper software and new business models.” They stated that open-source products accounted for a 13 percent share of the $92.7 billion software market in 2006, but should account for 27 percent of the market in 2011 when revenue is expected to be $169.2 billion, according to Gartner research. http://www.eweek.com/article2/0,1895,2186932,00.asp

On September 20, the Software Freedom Law Center has filed the first lawsuit to enforce the General Public License version 2 in the United States (”GPLv2″). The GPLv2 continues to be the most widely used open source license: more than 65% of the projects on SourceForge use it.

The plaintiffs, Erik Andersen and Rob Landley, sued Monsoon Multimedia, Inc. for copyright infringement of the BusyBox software in the Southern District of New York. The complaint can be found at http://www.softwarefreedom.org/news/2007/sep/20/busybox/complaint.pdf. The plaintiffs allege that Monsoon Multimedia distributed their program as part of their firmware, but did not make the source code available.

This case is very important because it will establish what type of remedies (either contract or copyright) are available to licensors for breach of the GPLv2. The Free Software Foundation has consistantly taken the position that the GPLv2 is a copyright license rather than a contract and that the failure to comply with its terms results in copyright infringement.

I don’t agree with the view that the GPLv2 is not a contract (see below for the significance of this distinction), because the GPLv2 includes many provisions such as a disclaimer of warranty which are characteristic of “contracts” for the sale of goods under Article 2 of the Uniform Commercial Code. This distinction could be important as illustrated in the recent decision in Jacobsen (see above) which provided that the remedy for the breach of the Artistic License was in contract (i.e. monetary damages) and not copyright infringement. The major difference in remedies is that contract remedies are generally monetary damages, but copyright remedies are generally injunctive relief (the court orders a party to do something) as well as monetary damages. Clearly, open source licensors would prefer to obtain injunctive relief to require the licensee to comply with the terms of the license.

However, the court’s decision on remedies will not turn solely on whether the GPLv2 is a copyright license or a contract: even if the court finds that the GPLv2 is a “contract”, it could also find that the breach of the GPLv2 results in copyright infringement (see the Jacobsen case blog for an explanation of this issue). The GPLv2 is very different from the Artistic License so the reasoning in the Jacobsen case may not apply. However, courts are very influenced by the decisions of other courts in new areas which is why the wrong decision in the Jacobsen case is so important.

Stay tuned, this case will be very important for the future of open source software.