Full disclosure, I work for Microsoft.
The GPL is not the only open source license. It may screw up certain commercial usage, but it never stops users from forking the software. This Microsoft license does.
The GPL has a few problems, but non-commercial causes are just noxious.
Who exactly can use a non-commercial piece of software? Presumably, universities can. Can a government research lab use it? How about a military research lab? What about a contractor doing military R&D? If Exon-Mobile uses this to search for oil, is this research (thus non-commercial)?
Any clause which is likely to give your lawyer a headache trying to interpret it is probably a bad license.
The GPL has some ambiguous bits (like its interaction with interpreted code eg Python bindings to MySQL and Javascript libraries in the browser) but it's not as ugly as the term Non-Commercial.
If the JS engine mixes interpreted code with the proprietary DOM, how does that work?
How about LGPL works?
But you're right - it's usually pretty clear if you think about it. There will always be edge-cases, but unlike non-commercial clauses the edge cases aren't that common.
If you distribute GPL code you then become subject to its restrictions and must provide the code.
For MS and a surprisingly small (in terms of total global economy) number of other businesses selling closed source software (or software dependent on other non-Free software components) the GPL imposes very real restrictions.
I would argue that they are in no way arbitrary but have a clear purpose and objective to further increase the amount of Free software in the world. You may or may not support or want to assist this objective but it certainly doesn't feel arbitrary to me (I've taken the 'capricious; unreasonable; unsupported' definition of arbitrary from Dictionary.com as my interpretation of your meaning).
Edit/reply:
Can't reply to you for some reason. No citation but you have missed my point. I wasn't comparing Open Source Industry to closed source software industry but really the software industry to ALL Other industries (and individuals) in the world. Basically software consumers rather than producers (of which closed source companies like MS form a large part).
If RMS was true to his principles, he would make GPL more viral to cover every deployment and co-deployment. But they leave this huge server hole instead. That is what I mean by arbitrary. Why a hole there and not elsewhere?
Don't want to answer for RMS. I can't think of less arbitrary way of achieving their aims.
If they were banned because of the GPL the company was doing its own stupid rules completely unrelated to the restrictions imposed by the GPL. If they weren't then it shows the difference between the GPL and the non-commercial use term of this particular MS license.
There is basically no disagreement about what counts as an open source/free software licence. This licence is not that.
It is damaging to the ideas of FLOSS to allow stuff like "shared source" to be called open source.
EDIT: Removed reference to "open source" being trademarked, it is in fact not, apologies for the confusion.
A trademark does not take ownership of general words or phrases from the people.
Also, is "open source" really trademarked? Wtf? That's like a beef promo organisation trademarking "well done".
If you allow stuff like "shared source" to be called open source, you reduce the term to a meaningless buzzword, like how the term "open" is frequently abused.
citing trademarks is a heavy handed approach, but many parties with a profit motive don't care about anything except strict legality.
This is relevant in particular to this blog because Microsoft has a history of attempting to change what the term means
Except when that trademark is "Windows" or "Office" or "Word".
This is a bit of a digression from the original topic, but seems tangentially relevant given that we're talking about Microsoft accidentally misusing or deliberately abusing a term that has an accepted meaning in the marketplace, the very purpose for which trademarks were created.
[Also, I should have added the following disclaimer to the previous comment: Disclaimer: Long ago, in a galaxy far away, I worked for a company that seemed to have a chance at invalidating the Windows trademark, but when Microsoft offered a large settlement, my former employer took the money and ran.]
Likewise, it is reasonable that Microsoft can't call their competing license "open source" when that term already has an established commercial definition and trademark with a specific set of consumer expectations.
Further, until a tradmeark is filed or established by extensive use, competing products can use similar words in their titles. Once upon a time you could have had Microsoft Windows, OpenWindows, the comp.windows.x newsgroup (suggesting that X is a subset of the generic category of "Windows"), etc. Now they will sue if your OS name even rhymes with Windows.