Determining which license to use for your project can be a fairly complex task; it's the kind of task you probably don't enjoy but your legal team will. There are other papers and web sites that cover copyright issues in finer detail; I'll provide an overview, though, of what I see as the business considerations of each style of license.
This is the copyright used by Apache and by the BSD-based operating systems projects (FreeBSD, OpenBSD, NetBSD), and by and large it can be summed up as, "Here's this code, do what you like with it, we don't care, just give us credit if you try and sell it." Usually that credit is demanded in different forms—on advertising, or in a README file, or in the printed documentation, etc. It has been brought up that such a copyright may be inscalable—that is, if someone ever released a bundle of software that included 40 different open-source modules, all BSD-based, one might argue that there'd be 40 different copyright notices that would be necessary to display. In practice this has not been a problem, and in fact it's been seen as a positive force in spreading awareness of the use of open-source software.
From a business perspective, this is the best type of license for jumping into an existing project, as there are no worries about licenses or restrictions on future use or redistribution. You can mix and match this software with your own proprietary code, and only release what you feel might help the project and thus help you in return. This is one reason why we chose it for the Apache group—unlike many free software projects, Apache was started largely by commercial webmasters in search of a better web server for their own commercial needs. While probably none of the original team had a goal of creating a commercial server on top of Apache, none of us knew what our futures would hold, and felt that limiting our options at the beginning wasn't very smart.
This type of license is ideal for promoting the use of a reference body of code that implements a protocol or common service. This is another reason why we chose it for the Apache group—many of us wanted to see HTTP survive and become a true multiparty standard, and would not have minded in the slightest if Microsoft or Netscape chose to incorporate our HTTP engine or any other component of our code into their products, if it helped further the goal of keeping HTTP common.
This degree of openness has risks. No incentive is built into the license to encourage companies to contribute their code enhancements back to the project. There have certainly been cases in Apache's history where companies have developed technology around it that we would have like to have seen offered back to the project. But had we had a license which mandated that code enhancements be made available back to the project, such enhancements would perhaps never have been made in the first place.
All this means that, strategically speaking, the project needs to maintain sufficient momentum, and that participants realize greater value by contributing their code to the project, even code that would have had value if kept proprietary. This is a tricky ratio to maintain, particularly if one company decides to dramatically increase the amount of coding they do on a derivative project; and begins to doubt the potential return in proportion to their contribution to the project, e.g., "We're doing all this work, more than anyone else combined, why should we share it?" The author has no magic bullet for that scenario, other than to say that such a company probably has not figured out the best way to inspire contributions from third parties to help meet their engineering goals most efficiently.
The Mozilla Public License (MPL) was developed by the Netscape Mozilla team for use on their project. It was the first new license in several years when it was released, and really addressed some key issues not addressed by the BSD or GNU licenses. It is adjacent to the BSD-style license in the spectrum of open-source software licenses. It has two key differences:
It mandates that changes to the "distribution" also be released under the same copyright as the MPL, which thus makes it available back to the project. The "distribution" is defined as the files as distributed in the source code. This is important, because it allows a company to add an interface to a proprietary library of code without mandating that the other library of code also be made MPL—only the interface. Thus, this software can more or less be combined into a commercial software environment.
It has several provisions protecting both the project as a whole and its developers against patent issues in contributed code. It mandates that the company or individual contributing code back to the project release any and all claims to patent rights that may be exposed by the code.
This second provision is really important; it also, at the time of this writing, contains a big flaw.
Taking care of the patent issue is a Very Good Thing. There is always the risk that a company could innocently offer code to a project, and then once that code has been implemented thoroughly, try and demand some sort of patent fee for its use. Such a business strategy would be laughably bad PR and very ugly, but unfortunately not all companies see this yet. So, this second provision prevents the case of anyone surreptitiously providing code they know is patented and liable to cause headaches for everyone down the road.
Of course it doesn't block the possibility that someone else owns a patent that would apply; there is no legal instrument that does provide that type of protection. I would actually advocate that this is an appropriate service for the U.S. Patent and Trade Office to perform; they seem to have the authority to declare certain ideas or algorithms as property someone owns, so shouldn't they also be required to do the opposite and certify my submitted code as patent-free, granting me some protection from patent lawsuits?
As I said earlier, though, there is a flaw in the current MPL, as of December 1998. In essence, Section 2.2 mandates (through its definition of "Contributor Version") that the contributor waive patent claims on any part of Mozilla, not just on the code they contribute. Maybe that doesn't seem like a bug. It would be nice to get the whole package waived by a number of large companies.
Unfortunately, a certain large company with one of the world's largest patent portfolios has a rather specific, large issue with this quirk. Not because they intend to go after Mozilla some day and demand royalties—that would be foolhardy. They are concerned because there are parts of Mozilla that implement processes they have patents on and receive rather large numbers of dollars for every year—and were they to waive patent claims over the Mozilla code, those companies who pay them dollars for those patents could simply take the code from Mozilla that implements those same patents and shove them into their own products, removing the need to license the patent from said large company. Were Section 2.2 to simply refer to the contributed patches rather than the whole browser when it comes to waiving patents, this would not be a problem.
Aside from this quirk, the MPL is a remarkably solid license. Mandating back the changes to the "core" means that essential bug fixes and portability enhancements will flow back to the project, while value-added features can still be developed by commercial entities. It is perhaps the best license to use to develop an end-user application, where patents are more likely to be an issue, and the drive to branch the project may be greater. In contrast, the BSD license is perhaps more ideal for projects intended to be "invisible" or essentially library functions, like an operating system or a web server.
While not obviously a business-friendly license, there are certain aspects of the GNU license which are attractive, believe it or not, for commercial purposes.
Fundamentally, the GPL mandates that enhancements, derivatives, and even code that incorporates GPL'd code are also themselves released as source code under the GPL. This "viral" behavior has been trumpeted widely by open-source advocates as a way to ensure that code that begins free remains free—that there is no chance of a commercial interest forking their own development version from the available code and committing resources that are not made public. In the eyes of those who put a GPL on their software, they would much rather have no contribution than have a contribution they couldn't use as freely as the original. There is an academic appeal to this, of course, and there are advocates who claim that Linux would have never gotten as large as it has unless it was GPL'd, as the lure of forking for commercial purposes would have been too great, keeping the critical mass of unified development effort from being reached.
So at first glance, it may appear that the GPL would not have a happy co-existence with a commercial intent related to open-source software. The traditional models of making money through software value-add are not really possible here. However, the GPL could be an extraordinarily effective means to establish a platform that discourages competitive platforms from being created, and which protects your claim to fame as the "premier" provider of products and services that sit upon this platform.
An example of this is Cygnus and GCC. Cygnus makes a very healthy chunk of change every year by porting GCC to various different types of hardware, and maintaining those ports. The vast majority of that work, in compliance with the GPL, gets contributed to the GCC distribution, and made available for free. Cygnus charges for the effort involved in the port and maintenance, not for the code itself. Cygnus's history and leadership in this space make it the reference company to approach for this type of service.
If a competitor were to start up and compete against Cygnus, it too would be forced to redistribute their changes under the GPL. This means that there is no chance for a competitor to find a commercial technical niche on top of the GCC framework that could be exploited, without giving Cygnus the same opportunity to also take advantage of that technology. Cygnus has created a situation where competitors can't compete on technology differentiation, unless a competitor were to spend a very large amount of time and money and use a platform other than GCC altogether.
Another way in which the GPL could be used for business purposes is as a technology "sentinel," with a non-GPL'd version of the same code available for a price. For example, you may have a great program for encrypting TCP/IP connections over the Internet. You don't care if people use it non-commercially, or even commercially—your interest is in getting the people who want to embed it in a product or redistribute it for profit to pay you for the right to do that. If you put a GPL license on the code, this second group of users can't do what they want, without making their entire product GPL as well, something many of them may be unwilling to do. However, if you maintain a separate branch of your project, one which is not under the GPL, you can commercially license the separate branch of code any way you like. You have to be very careful, though, to make sure that any code volunteered to you by third parties is explicitly available for this non-free branch; you ensure this by either declaring that only you (or people employed by you) will write code for this project, or that (in addition) you'll get explicit clearance from each contributor to take whatever they contribute into a non-free version.
There are companies for whom this is a viable business model—an example is Transvirtual in Berkeley, who are applying this model to a commercial lightweight Java virtual machine and class library project. Some may claim that the number of contributors who would be turned off by such a model would be high, and that the GPL and non-GPL versions may branch; I would claim that if you treat your contributors right, perhaps even offer them money or other compensation for their contributions (it is, after all, helping your commercial bottom line), this model could work.
The open-source license space is sure to evolve over the next few years as people discover what does and does not work. The simple fact is that you are free to invent a new license that exactly describes where on the spectrum (represented by BSD on the right and GPL on the left) you wish to place it. Just remember, the more freedoms you grant those who use and extend your code, the more incented they will be to contribute.