Mark Radcliffe is one of the industry's preeminent open source attorneys. He's the one I went to a few years back when I was considering starting my own open source startup. I have a huge amount of respect for him.
All of which makes his commentary on GPLv3 hearty, worthwhile reading. Mark calls out the need for an update to GPLv2 first:
The final version of the General Public License Version 3 ("GPLv3") published on June 29th is a significant improvement over General Public License Version 2 ("GPLv2") and deserves to have broad acceptance. In fairness to GPLv2, the GPLv2 was drafted in 1991: both the law relating to software and the manner in which software is developed and distributed has changed significantly since 1991.
But he doesn't end there. He goes on to walk through ten areas that GPLv3 improves or clarifies (or both) GPLv2, including this commentary on the license's applicability to Application Service Providers:
Application Service Provider ("ASP"). One of the significant issues in drafting the GPLv3 was the treatment of a new method of making software functions available: companies that do not "distribute" software, but rather make it available as a service (called an Application Service Provider). Since no distribution occurs, these companies do not have to comply with the "copyleft" provisions of the GPL such as making their source code available to their licensees. This problem was referred to as the "ASP [loop]hole." This issue was not addressed in GPLv2 because this method of distribution did not exist in 1991. After considering several approaches, the FSF chose to provide an alternative license for those who wished to address this issue: the Affero General Public License ("AGPL"). The AGPL includes a provision requiring that companies providing services over a network make the source code available to users of the services (just as if the companies had distributed a copy of the software under the GPLv3) based on the well known "Affero" modification to the GPLv2. The GPLv3 also permits AGPL licensed software to "link" to GPLv3 licensed software, but does not permit the AGPL licensed software to be distributed under the GPLv3.
In short, many of us are still waiting for a good solution to the ASP Loophole problem (one that I think Larry Rosen's Open Software License 3.0 may well provide). In the meantime, be sure to read Mark's full commentary on GPLv3. It's a great way to get quickly up to speed on what GPLv3 means for would-be licensors and licensees.