That's it, it is very simple. I've had the misfortune of talking to a lot of different IP lawyers over the years about this topic, and every one that I've talked to all agree that there is no way that anyone can create a Linux kernel module, today, that can be closed source. It just violates the GPL due to fun things like derivative works and linking and other stuff. Again, it's very simple.
Now no lawyer will ever come out in public and say this, as lawyer really aren't allowed to make public statements like this at all. But if you hire one, and talk to them in the client/lawyer setting, they will advise you of this issue.
I'm not a lawyer, nor do I want to be one, so don't ask me anything else about this, please. If you have legal questions about license issues, talk to a lawyer, never bring it up on a public mailing list like linux-kernel, which only has programmers. To ask programmers to give legal rulings, in public, is the same as asking us for medical advice. It doesn't make sense at all.
But what would happen if one day the Linux kernel developers suddenly decided to let closed source modules into the kernel? How would that affect how the kernel works and evolves over time?
It turns out that Arjan van de Ven has written up a great thought exercise detailing exactly what would happen if this came true:
slide 13
In his article, which can be found in the linux-kernel archives really easily, he described how only the big distros, Novell and Red Hat, would be able to support any new hardware that came out, but would slowly stagnate as they would not be allowed to change anything that might break the different closed source drivers. And then, if you loaded more than one closed source module, support for your system would pretty much be impossible. Even today, this is easily seen if you try to load more than one closed source module into your system, if anything goes wrong, no company will be willing to support your problem.
The article goes on to show how the community based distros, like Gentoo and Debian, would slowly become obsolete and not work on any new hardware platforms, and dry up as no users would be able to use them anymore. And eventually, in just a few short years, the whole kernel project itself would come to a standstill, unable to innovate or change anything.
It's a really chilling tale, and quite good, please go look it up if you are interested in this topic.
But there's one more aspect of the whole closed source module issue that I really want to bring up, and one that most people ignore. It's this:
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Remember, no one forces anyone to use Linux. If you don't want to create a Linux kernel module, you don't have to. But if your customers are demanding it, and you decide to do it, you have to play by the rules of the kernel. It's that simple.
And the rule of the kernel is the GPL, it's a simple license, with standard copyright ownership issues, and many lawyers understand it.
When a company says that they need to "protect their intellectual property", that's fine, I and no other kernel developer has any objection to that. But by the same token, you need to respect the kernel developers intellectual property rights. We released our code under the GPL, which states in very specific form, exactly what your rights are when using this code. When you link other code into our body of code, you are obligated by the license of the kernel to also release your code under the same license (when you distribute it.)
When you take the Linux kernel code, and link or build with the header files against it, with your code, and not abide by the well documented license of our code, you are saying that for some reason your code is much more important than the entire rest of the kernel. In short, you are giving every kernel developer who has ever released their code the finger.
So remember, the individual companies are not more important than the kernel, for without the kernel development community, the companies would have no kernel to use at all. Andrew Morton stood up here two years ago and called companies who create closed source modules leaches. I completely agree. What they do is just totally unethical. Some companies try to skirt the license of the law on how they redistribute their closed source code, forcing the end user of it to do the building and linking, which then causes them to violate the GPL if they want to give that prebuilt module to anyone else. These companies are just plain unethical and wrong.