NEW YORK ( TheStreet) -- Wall Street has two reasons to hate open-source software. One makes sense, one makes none. The reason that makes sense is that open-source software companies don't make much money. When you offer code on a Web site, free for the taking, people tend to take it. Most won't pay you for using it. Some might even try to make money from it, and the costs of policing a license violation don't come back. Most open-source benefits don't go to the vendor. Most go to the customer. You make money from open-source by using open-source to make something. Take Eclipse, for example. The Eclipse Foundation organizes the code base, polices the license, and builds a community around its code. Its funding comes from members and sponsors, who are all free to extend the code base to make their own products. They make a lot of products, according to this Wikipedia list. IBM ( IBM) bases whole product lines on Eclipse code. Google ( GOOG), Oracle ( ORCL), Hewlett-Packard ( HPQ) and Red Hat ( RHT) all produce products based on the code. People pay for their code. IBM is the best-known and most notable Eclipse sponsor. It is not a charity. It uses an open-source development model to assure the stability of the code base, and this use assures both competition and compatibility. IBM spent most of its first century tied to a proprietary model. Its mainframe business is still based on proprietary code. But it fought a 40-year antitrust struggle with federal regulators and found by the early 1990s that its size could not assure it control of the key PC code vbase, which went to Microsoft's ( MSFT) Windows. It learned from that experience that it could make just as much money with services and hardware, solving problems, as it could selling and defending code. It shed much of the bureaucracy it had built to do that, a lot of PR and strategy and legal help. It rebuilt itself from the ground up, on open-source. IBM is no longer America's biggest tech company, nor does it have the fattest profit margins. But it doesn't have the government asking it questions, and it remains profitable.