Dan is right, I was thinking that microsoft was a normal company that had bought caligari as an asset. But that really hasn't been part of their history. So it is probably unlikely that truespace will ever come back. The idea of it being released as open source is really unlikely.
It appears that the entire Caligari team has been let go but I do not know about Ormandy. So I wonder what that says about 3d on the web. Is microsoft saying that it is not worth the investment?
It is sad to see Truespace go,even though it may not have been as powerful as the big apps. If the smaller apps like truespace or carrarra go out will they still feel a need to improve Maya and the related "big industry" apps?
Here is a link to a statement by Ton over at blendernation. It is interesting but I do not think Truespace becoming open source is going to happen.
http://www.blendernation.com/2009/05/21/truespace-story-ending/

I remember when this last version of Truespace was released commercially that Roman touted a web collaboration feature that looked really cool in demos. It basically allowed two people to work on the same scene remotely. I can't think of another package that allows real-time collaboration. Did that feature work? Perhaps that is the piece that attracted Microsoft?

[EDIT]
It attracted me, until I looked at the retail price at the time and later got to see the interface!

http://verse.blender.org/

i am not sure though if the blender integration still works.

Truespace was free today but when the version 7 comes out it wasn't so don't be like that.

you know that the hobbyist market are nothing compare to cgi industry. There is no point in fighting since cgi industry make millions just with adverts and films. Of course Maya and 3ds Max are really expensive but they still exist because the industry supports them. It is just a matter of money It's sad but because truespace didn't convince university or artist to use it. IF it was any good no matter how low or high was the price people will purchase it or download warez version.

For example if you just do a job as a freelance animator you can earn in a week 1000 1500-ish £. This is good money but you have to invest in exchange to the lastest tool. If you are a taxi driver you'll have to invest in good car to do your job or working in a comapny which already have few.

For indies maybe is out of range but for most of the artist is a necessary investement for making a living.

but I think it's not over for caligari. Maybe they made this decision to recreate something more fitted to our demands, but I'm afraid the price will be higher than truespace.

I may opinion also the company has had his own responsability
I purchased GameSpace from them
I thought it was a good idea at the time
A professional package at a reasonable price ( 600 usd If I remember ) but it was a disaster , full of bugs
Even worse they refused to admit the evidence
I suppose that they disgusted many clients, me for sure

Roman Ormandy, Caligari's founder and ex-CEO, posted on the company's forums that Microsoft has decided to keep the website up and running for the next five months. They also just posted the last beta version of the software, 7.6.1.

The software, training materials and everything else on the site is available for free download. Once you get past the shock of the garish UI, the software really did have a lot of cool features.

http://www.caligari.com/downloads.html

Gamespace was a very special chapter. Caligari tried to do too much at once at that time. And forgot to make the product stable over that.

And yes, Caligari made lots of mistakes then. The Bridge is the most obvious one. I doubt that Roman would do that again, heh. On the other hand, this makes it possible to have both softwares at once, the old tS 6.6 and the new core. Curse and blessing at the same time. Because what the Workspace lacks can be done in Modeler most of the times.

Suede, you are right. But not in all points. As i am right too, but not in all points. Again you forget the hobbyists. Not all CG is done by professionals. I don't have the money for your named softwares. And will never have.

I still hope that the tS development continues. It was and is on a good track. The new core has enough power to be state of the art once all tools are in place. It is just not finished yet.

I bought it cheaper (maybe half of the price you mentioned) but experienced a similar story.

I liked the way of modeling very much. It worked great and fast. I could do a lot with these little gizmos. But uv-mapping was bad and animation crashed it a lot. There was no way for texture baking and baking or rendering normal maps was not possible. So I left it and switched to Lightwave at that time. And recently I added Modo. Both are working great together.

When I posted any questions and problems in the Caligari forums then the posts just got ignored. It always felt like a dead and no more supported tool. I was happy to make the switch.

Even a free software will not help in this matter. I need a tool that simply works.

just an example , GameSpace supplied a tool named Puppeter for animations
It crashed any minute or two
I was replied something like " this tool has been developed by a third party , ask them "
I said, sorry my friend, it is integrated in your product you are responsible also for it
No answer
Some time later I got an email from an other guy to apologize for his collegue's previous answer

Yes. Stability problems in old trueSpace up to 6.6 are legend. That's why the advice was save often, and don't forget to save often. And because of exactly these kind of problems the guys started to develop the new core, trueSpace 7. Devs stated more than once that the old code busted at the seams. Means they knew about the stability problems very well, but couldn't really fix them. Or better said the fix is the new tS 7 core ...

Regarding Puppetteer. It IS a third party tool. Even when it came with gameSpace. Means you really would've had to talk to the pupetter makers, not Caligari. It's like moaning towards 3D Gamestudio when IceX makes trouble (no offence, just an example ) ...