Comment You did the right thing... (Score 1) 325
1) RMS himself clarifies at least his intent in developing a (free as in freedom, free as in beer) OS & tools for everyone differentiates between widely empowering technology like OSes, compilers, and printer drivers versus specialized applications with few users. He points out that if the ecosystem is small, then proprietary relationships may be necessary and therefore appropriate. (Sorry no time to dig out the quote, but its in his stuff on the FSF site.) The question is what will be better for common good, so consider size of the user community, business models, etc. A kind but proprietary business with good practices that survives -> is better than an over-idealistic business that fails -> is better than a mean business with selfish intentions and bad practices that enlists and then controls customers.
2) Are the benefits of going public and free worthwhile against the loss of proprietary value? If your company will make larger revenue because your competitors have adopted your software, then go for it. That means the driver of your revenue has more to do with your business activities like selling, integrating, servicing, designing solutions. For example, if being able to integrate your equipment easily with your competitors means you make more money. But if you rely on the performance/capabilities of your software to drive revenue, then keep it closed until your business has grown up to become more service oriented.
3) Don't expect your competitors to play fair with the free software they pick up. They're not going to contribute back as they should. They might not admit they are using the software.
4) You don't need to go public with your free software yourself. Your question was w/respect to the community, so maybe this point is not relevant. Customers should be looking for free software in case a) you fold & no longer service their maintenance needs; b) they wish to take development on a different tack, they should be able to start with your product as a basis; c) they want remarketing rights, etc. But just because you sell them free software doesn't mean they intend to remarket or even give it out to anybody else, though they have the right. As to these customer needs, you may be able to come to an informal understanding that is mutually beneficial, or you may provide for the specific rights they wish in a specific license for them instead of making the software fully free.