In an interview Tuesday at the TechEd 2001 conference, Gates observed that Microsoft routinely shares the source code for its Windows operating system with its partners. In addition, the company uses some open-source software in its Hotmail email service.
However, Gates said, "there are problems for commercial users relative to the (GNU General Public License), and we are just making sure people understand the GPL".
The GPL governs changes to the software core, or kernel, of Linux as well as other software, and is used to govern many open-source projects as well. Under the license, a company must publish any changes to the kernel if it distributes the code.
Open-source supporters point out that the GPL allows companies to write and sell proprietary programs that work with GPL-licensed code, as long as the software doesn't contain GPL code.
Linux is one of the most visible examples of software that has been developed and improved under an open-source effort. An operating system created by Linus Torvalds that is used primarily in servers, Linux is governed by the GPL and competes with Microsoft's own server software.
According to research firm IDC, Linux accounted for 27 percent of new worldwide operating-system licenses in 2000, and Microsoft's Windows captured 41 percent of new licenses.
Gates said Microsoft's stance on open source "has been misconstrued in many ways. It's a topic that you can leap on and say, 'Microsoft doesn't make free software.' Hey, we have free software, the world will always have free software. I mean, if you characterize it that way, that's not right. But if you say to people, 'Do you understand the GPL?' (then) they're pretty stunned when the Pac-Man-like nature of it is described to them."
He said: "The ecosystem where you have free software and commercial software--and customers always get to decide which they use--that's a very important and healthy ecosystem."
The GPL, he continued, "breaks that cycle--that is, it makes it impossible for a commercial company to use any of that work or build on any of that work. So what you saw with TCP/IP or Sendmail or the browser could never happen. We believe there should be free software and commercial software; there should be a rich ecosystem that works around that."
Open-source advocates naturally disagree. For one, they argue that proprietary code such as Oracle's database software can run atop Linux with no legal or technical problems. Moreover, modules of proprietary code, such as a graphics card driver, may be plugged into the open-source kernel.
In addition, open-source licenses such as those that cover the BSD variants of Unix, such as FreeBSD and the Apache Web server, allow software to become proprietary.
VA Linux Systems chief executive Larry Augustin said that the "contamination" issues of GPL pale in comparison to those that people face when working with Microsoft software.
"Microsoft's shared-source (program) has many of the same issues, and they're often worse" because the person must make sure none of the Microsoft ideas creeps into other software, he said. "A person who's seen shared source is probably very contaminated and is going to have a hard time working on other projects."
Gates' comments amplify recent public statements by Microsoft executives that have cast Linux and the open-source philosophy as being everything from bad for competition to a "cancer".
Analysts also have interpreted Microsoft's criticism of Linux, in particular, as evidence of the company's growing concern over the popularity of the operating system. The success of Microsoft's .Net Web services plan relies on the company controlling the server operating-system market, analysts say.
"There are people who believe that commercial software should not exist at all--that there should be no jobs or taxes around commercial software at all," Gates said. While that's a small group, "the GPL was created with that goal in mind. And so people should understand the GPL. When people say open source, they often mean the GPL".
Stephen Shankland contributed to this report.