I came across this post on my friend Adam Williamson's blog today, advising me to read this, now. I attempted to take the advice in his title, but seeing as it's a workday, and the article he's linking is quite long, I didn't make it all the way through. Nonetheless I saw enough that I wanted to respond.
First of all, I am only peripherially aware of O'Reilly as a person. Beyond "that guy who publishes the books with the animals on them" I've never had much need for him. My complaint here is more with the tone and ideology expressed in the article Adam linked.
Second of all, the author throws around "Randian" a lot, and then interchanges "Libertarian" with it freely. As one of the many Libertarians who is Sick to Fucking Death of being compared with a certain mysoginist, egomaniacal sociopath, this was the first thing that got to me. I haven't even read Atlas Shrugged. I know I will have to soon to sustain rhetorical credibility with certain among my peers, and I dread it. The inevitable 1% are an acceptable side effect of putting the individual first and optimizing the market for wealth creation rather than wealth distribution. They are not a celebrated class of intellectual elites that are more in touch with some "objective" reality. There's a reason Baudrillard is on my night stand right now and not Rand. That's how "objectivist" I am.
Secondly, and this is more important: I consider Free Software to be a capitalist pursuit. I don't say Open Source, and I do so in adherence to the distinction the author draws between the terms. My support of Free Software is moral, it is about the rights of individuals, and it is fundimentally Libertarian.
To see why, let's bring out the old economic conservative whipping boy, U.S. farm subsidies. The U.S. has a whole slew of laws designed, supposedly, to ease the hardships of farmers. Economic conservatives like to beat up on these laws because, goals notwithstanding, they are unusually psychotic. The most famous element of the bills is a market-manipulation tactic wherein the government manufactures scarcity by "paying farmers not to grow crops." As far as I understand, this is literally true: the government pays certain farmers to stay out of the market to keep prices high for certain foods. I won't fact check it today (we're not actually here to talk about corn production), but the reaction the statement gets is important. There's very few people anywhere in the political spectrum who aren't somewhat taken aback. The power of this story as ammunition for economic conservatism comes from the fact that, true or not, it is unanimously considered a ludicrous state of affairs.
And copyright law is exactly the same.
Speaking purely econimically, incentive is incentive. The moral implications of "do this and I'll give you $30" versus "do this or I'll throw you in jail" are certainly relevant, but in terms of how they are expected to affect consumer behavior, they're more or less the same. The latter is less ethical but is a tool for the same applications, which makes copyright law a less ethical version of farm subsidies. The literal statement of copyright law is "don't make copies of this or we'll throw you in jail." The objective is the same too: to take other producers (in this case, pirates), out of the market to drive up costs.
Software, and information in general, is what we call a non-excludable, non-rival good. The shorter term is "public good," but we'll stay verbose for the sake of sounding a bit less politically loaded. Lack of excludability is a bit subjective: it means, in this context, that piracy cannot be stopped. Certainly there are those that would try, but the massive amount of online piracy certainly suggests that this is at least approximately true for a common parameter space. Non-rivalrousness is less disputable: it means that one person consuming software, or music, or a game, or what have you does not reduce the amount available to the whole: that providing a piece of software to twenty people costs the same amount of resources as providing it to two hundred.
Idealized models of capitalism predict that the price of a good should approach its marginal cost, which is to say the price to produce "one more unit" of that particular good. Given piracy, what do we infer is the marginal cost of producing one more copy of a piece of software? What does it take to produce one more copy of Windows if we let the pirates make copies? The answer is nothing. That's why pirates don't charge money, because fundimentally, the market does not want software to be worth any money.
This is where the Libertarian perspective on copyright law comes to a head: copyright law is a subsidy of a good that the internet has rendered unprofitable. The moral end of Free Software is not achieved, as the author of the original article suggests, by making laws, but by abolishing them: all of patent law and almost all of copyright law (we can spare attribution). Sounds nigh-anarchistic enough to fit in with our conception of Libertarians, doesn't it?
There are some questions left to deal with, such as software freedom and cloud services, or attempts to keep source code as a "trade secret" even when there's no legal infrastructure to back you up in case of a leak, but the fundimental notion that Free Software isn't a Libertarian cause is entirely unsound.