Microsoft has set up a new foundation aimed at bringing open-source and proprietary software companies together to participate side by side in open-source projects.

The new CodePlex Foundation "will complement existing open source foundations and organisations, providing a forum in which best practices and shared understanding can be established by a broad group of participants, both software companies and open source communities."

CodePlex has for some time been the name of the site on which Microsoft hosts open-source projects. Microsoft contributed US$1 million and the CodePlex name to the new foundation, which will license that name back to the CodePlex website so it can continue using it.

The interim president of the non-profit organisation will be Sam Ramji, who's currently senior director of platform strategy at Microsoft, in charge of the company's open-source endeavours. He is set to leave Microsoft this month to join a cloud-computing startup in Silicon Valley but will stay with the CodePlex Foundation through its first 100 days.

Ramji said the new foundation's mission is to foster more participation in open-source projects by commercial software companies, whose developers are not participating as much as they should be in them right now.

"There is a convergence of maturing technology and evolving business models, an inflection point [where] more software companies are exploring how to work with open-source communities. Some of us see a great opportunity to drive change."

A board of directors supporting Ramji is comprised mainly of Microsoft employees, including Bill Staples, Stephanie Boesch and Britt Johnson. The only non-Microsoft employees on the board are longtime open-source guru Miguel de Icaza of Novell and Shaun Walker, cofounder of DotNetNuke.

Ramji and the board will search for a permanent executive director of the foundation, which now only has a deputy director, Mark Stone, formerly of O'Reilly and VA Linux (now SourceForge), according to the website. Eventually, the foundation will have permanent board members who will all be well-known and respected members of the open-source community, he said.

Indeed, the eventual independence of the foundation separate from Microsoft will be key to getting developers on board to support it, said Stephen O'Grady, an analyst with RedMonk. He likened it to the Eclipse Foundation, another open-source group that started as a vendor-backed project - in this case, IBM - but that since has been able to operate independently with continued support but not strict oversight from IBM.

"What will be interesting to see is when and how CodePlex takes steps to establish an identity independent from that of Microsoft," O'Grady said.

When asked what differentiates the new foundation from existing open-source organisations, Ramji said that while most now are focused on promoting the work of specific projects, CodePlex will complement the activity of those and other open-source projects while keeping in mind considerations such as patented technologies and other interests of commercial software companies.

O'Grady acknowledged that it is complicated for commercial software companies to allow their developers to contribute code to open-source projects because of legal liabilities, and having a foundation devoted to helping them navigate that complexity is a valid mission.

"If you're a Fortune 50 organisation and one of your developers comes to you and says, 'I want to contribute to an open-source project,' how do you protect yourself from liabilities?" he said.

However, O'Grady added that other open-source foundations would argue that they already balance open-source and commercial interests side by side quite well. "Is it truly a differentiator for CodePlex? That remains to be seen," he said.

Microsoft historically has had a thorny relationship with the open-source community, but in the past couple of years Ramji's Platform Strategy Group has been trying to work more closely with open-source companies.

Ramji said Thursday that Microsoft remains committed to open source and the group he heads will continue at the company without him as Microsoft searches for his replacement. Microsoft also will continue to support other open-source projects - such as its current work with Apache - with funds and code contributions.

"The formation of the foundation is the culmination of what many at Microsoft have been working toward as an open-source strategy," Ramji said. "We hope the foundation will bring commercial software developers and open-source software developers closer together."

At the same time, however, Microsoft has continued to pose a litigation threat to open-source companies over patents it claims to hold for technologies incorporated in open-source software, including Linux. Microsoft has consistently and quietly been striking patent deals with Linux distributors. Some of the deals call for the companies to pay Microsoft to license patented technologies.

One case did go to court earlier this year, when Microsoft brought a patent suit against GPS device maker TomTom over patents included in the Linux implementation TomTom uses in its devices. TomTom eventually paid Microsoft out of court to settle the case, which Microsoft claimed was a patent case and not an attack against Linux