The FSF has revealed that will work with the Affero GPL project on version two of its modification of the GNU GPL, which is designed to close a loophole that enables GPL code to be offered as a service without modifications being published.

The loophole has enabled companies like Google to make use of open source code to offer online services without sharing their modifications with other developers, a model which is against the spirit, if not the current wording, of the GPL for some in the free and open source community.

The FSF had originally planned to tackle this loophole in the GPLv3 itself, but dropped that plan between drafts two and three in favor of working with online services firm Affero, which created the first AGPL in March 2002 with the support of the FSF.

We’ve come up with a better solution. We’re going to write a new license, version 2 of the Affero GPL, that solves this problem in a more general way and doesn’t dictate technology, confirmed Brett Smith, FSF licensing compliance engineer in a blog posting.

Smith was responding to some online criticism related to the disappearance of section 7(b)4 of the GPLv3 draft two, which would have forced all GPLv3 developers to publish their changes if their software was offered as a service.

One source of criticism was Fabrizio Capobianco, chief executive of open source mobile software vendor Funambol, who created his own Honest Public License in September 2006 as a temporary fix for the loophole.

In a blog posting Capobianco accused the FSF of not having the stomach to stand up to a fight with the likes of Google and criticized the group for adding to potential confusion with the creation of another open source license.

The FSF’s Smith insisted that the decision had been taken in order to simplify matters, however, by avoiding placing additional requirements on the GPL itself.

In an explanatory document accompanying draft three of GPLv3, the FSF explained that the decision had also been made in response to feedback from open source users and developers.

We have made this decision in the face of irreconcilable views from different parts of our community, it stated. While we had known that many commercial users of free software were opposed to the inclusion of a mandatory Afferolike requirement in the body of GPLv3 itself, we were surprised at their opposition to its availability through section 7.

It added: Free software vendors allied to these users joined in their objections, as did a number of free software developers arguing on ethical as well as practical grounds.

Smith revealed that version two of the Affero GPL will be drafted using the same drafting process currently being used by the FSF to create the third version of the GPL and that an initial version is already being circulated among stakeholders.