That feels like a backwards argument to me. There are many free software companies (RedHat, SUSE, Canonical, etc) that create plenty of innovative software. I'm sure you know the difference between "free as in beer" and "free as in speech", but your argument appears to be conflating proprietary and commercial. Especially when you start discussing academic settings (which, by the way, uses
a lot of proprietary software).
But more importantly, a discussion of "what could've been" is not really helpful to a discussion of what we should do today. I could equally argue that if users were more empowered than they are now, that you would see much higher levels of technical literacy and much more innovation. Do I have evidence to back that up? No, but neither do you.
I can give you more examples of free software that didn't have a proprietary counterpart, but I don't think that you really want such examples. You want to discuss an alternate universe where proprietary software doesn't exist.
> Would there be a Microsoft, Google or Apple or Facebook? No.
How on Earth could you possibly know that? You're possibly right that they wouldn't be identical to their current counterparts (they probably wouldn't be able to mistreat their users to the same extent), but those companies and those products might still exist.
Social networks existed before Facebook. Hand-held computers existed before Apple. Search engines existed before Google. Operating systems existed before Microsoft.