Well, Sun pulled through and made it happen: Java is now open source. The really free license is GPL with the so called Classpath Exception. "Normal" GPL has a so-called viral clause that means that software using GPL code must be licensed under the GPL as well. The "classpath exception" means that it is legal for any software to use the classpath binaries, no licensing strings attached. So no worries, all "evil" commercial closed source is still allowed to use the Java run-time.
Will this licensing move eliminate poverty, cure cancer or otherwise make this world a better place? Sun can say again they are the open source company. The "pure" open source movement that had to resort to Python, Perl, etc. can finally embrace Java, and it can be included in even the purest Linux distros. People may finally contribute to the JDK on a peer-based level. This means extra bugs get fixed and features may get in faster and better.
If Sun gets a community mobilized to work on Java…
All development on the JDK is moved to the java.net openjdk project (apparently, to some this is a very funny domain name 😉 ). Fortunately, Sun has some experience with open source. However, the Java SDK is a huge project. It will be a hard and complex effort, and if it turns out wrong, Sun just wastes a lot of time and energy on a community that does not want or is not able to contribute. The interview with James Gosling is reassuring though. They definitely seem to want this open source thing to work for Java. I hope Sun can gather the community and show the world that this is not just some license nagging, but open source for real!