There's risks. There's several approaches that come to mind: straight up free software; software and hardware at cost; one of these for a certain period to allow growth before charging for it.
The free software obviously isn't making the company money. However, most internal projects on a budget or startups in this era aren't going to choose IBM's tools. They're too expensive and not that popular. So, by not giving it away, they probably gain nothing in licensing. By giving it away, they gain nothing in licensing but might in the project's goal due to software's advantages.
For at cost, it might be sustainable. They continue to make most of their profit outside IBM. Inside IBM, they offer their products anywhere ranging from free to a considerable discount. The offer covers the cost of the product in terms of delivery, support, hardware, and so on. That money fuels development and/or cost-cutting on the offerings in general. Volume of IBM use alone might add several developers to any product. So, in this model, there's no losses past what they currently charge, the products get funds for development, and there are gains throughout organization via their benefits.
The final model is basically a trial period. The projects or acquired startups get to use their choice of products with discounts ranging from cheaper to at cost to free depending on budget. As budget or success grow, the discount gets lower. Over time, you have a division that's paying full price for the products or begins transitioning to others. You get the benefits of option 2 with some of what general market might pay.
Personally, I think Model 1 wouldn't hurt them except whatever they're charging for internal use. Model 2 seems to be the best with Model 3 having a chance of success. The reason I promote this is that IBM is sitting on a lot more potential than they're using, mostly due to culture. However, I think they could create significant, competitive advantages if all their projects and divisions could inexpensively use every key capability they've produced. Software productivity, security, infrastructure, and administration at the least.
