I'll take a wild guess that you are not a developer, hence the rubbish question `why should they waste their time developing...` Developing is not a waste of time, even if you don't get any money you gain knowledge and experience. Lots of us became developers by developing for free, for years. Next time when you visit any web page ask yourself the same question as more than 50% of the Internet runs on FOSS (Linux, Apache, Perl, PHP, Python...). There is also ~20% chance that you surf the web using something that's also FOSS (various Mozilla projects). And then there are projects like OpenOffice.org, The GIMP and tons of others - all of which are developed without charging a dime to the end users.

In the last decade I've primarily developed using FOSS solutions and contributing back to the community, and I'm getting a decent living out of it, thank you very much. You don't need to be able to sell your software to the end users in order to make money out of it. And even if you don't make any money in any way on your FOSS development, there are tons of other incentives to make you develop your software for free - community cred, learning, pimping up your CV, making useful contacts... I know quite a lot of people that make more than a decent living without selling a single line of their code to the end users.

Just because you don't understand it, or because it doesn't conform to the conservative way of doing business, it doesn't mean that it doesn't work.