I'm glad he decided to make it free and to keep modability basically as it is now (by directly modifying source rather than working a system in-game that may not expose all parts of it to modding). That said, I'm sure there might be legal concerns with this direction. I don't think this choice would work with a high end title, because Minecraft is going to basically become open source: "agree to this license, and you get access to the full source." This is already how modding works, except it's not yet legally sanctioned and that anyone who does want to go through it needs to get the unobfuscated code (or do it themselves). Hopefully Minecraft's 'indie' cred will keep this from being exploited in some unforseeable way.
Pros:
* Minecraft stays completely moddable. An API could never match or allow everything that's being done right now, because these mods are more like hacks that modify source and an API may not, for example, allow for the possibility of a new resource like electrical energy (or modifying unit AI, for example).
* Modders get to update their mods faster because they don't need to wait for an ubobfuscated source.
Cons
* What will it mean for Minecraft's future? Maybe nothing, maybe everything.
* Who determines whether mods are not 'malicious'? Is someone going through all of a mod's code to see that it's not actually doing anything malicious? Does it merely wait for some industrial player to read through and then pan the mod for this?
* What are the restrictions for being licensed? Presumably owning a copy of Minecraft to start with. Presumably if you break the license your Minecraft account gets banned. Do you need to provide your own real name? Identification?
* What stops piracy of the source(!), which are then developed by people without a license? Accept that it may happen?
I guess all of those cons are really just unanswered questions. I like this change because it keeps things as they are and mods can continue to be game-altering if you so choose (and who knows where things will go with full source access: mods with goal-specific scenario gameplay, maybe?). My concerns are just the unanswered questions.
(!)I guess if you tag the source with an identifier specific to the login which downloaded it, you could track piracy in that way and ban the offending account. That does not preclude the identifier being somehow altered or removed before being rehosted.