Sounds like a lot of open source software.

True, but with open source at the end of it you have the right to continue using what you created. In this other case, you are gifting the value of your work to the corporation irrevocably and retain no rights.

But you also get to slap that company's name on your resume. Never having been in a hiring position, I'm curious as to which sounds better:

"I worked on OpenOffice.org providing support for a specific file extension"

"I worked for Microsoft as an intern. I built support for a file extension in Office 11, though it was not used in the final product."

While the first statement has the value of "Let me show you what I wrote", I don't think the second statement is anything to scoff at.

Microsoft doesn't have unpaid internships, nor do they have internships you have to pay for. Nor does Google. Do you have any examples of technology companies with great reputations that charge students for internships?

Nope. Just trying to draw an analogy. Journalism is a very different ballgame. The concept of high profile open source journalism is non existant.

My question wasn't about whether they were paid or not, it was about whether a scrapped feature is still valuable resume experience.

The logic chain is this: If a scrapped feature is still valuable resume experience, then working on a project not deemed worthwhile by a corporation is still valuable experience. If it's still valuable experience, there may be situations in which it is beneficial to take such an unpaid internship.

The whole argument here isn't whether or not to pay interns for such a job. It's already established that they will not be paid for such a position. Either unpaid interns do it or nobody does it. End of story. The question is whether or not to allow people to pursue such an opportunity without pay. I think there are many people that would benefit from such an arrangement. Not just students, but with the high unemployment rates, anyone trying to gain a little more experience or get their foot in the door.

Someone doing work with no business value for another party doesn't make much sense to me. Sure perhaps it benefits the worker in some way. Perhaps he learns the value of coming to work on time and obeying arbitrary orders to do work that everyone agrees is useless and unneeded (which is the premise you have made - I am presuming it for the sake of argument here). I postulate though that it would be even more valuable experience to do work that everyone agrees is useful and needed. It's not like there is a shortage of that. In development, there's tons of valuable software that needs to be written. The state of practice in this industry is quite poor, especially of much corporate produced software titles compared to indie releases. Why not write valuable software instead of useless when there is so much valuable software to write? Writing useless software for the purpose of experience seems a not optimal choice when one could just as easily write useful valuable software.

And now, given that one is writing useful valuable software that is of benefit to others, of course the developer should be paid for their work.

yes but is that true in journalism? (The topic Mark Cuban is discussing)

Software development is unique in that there are no real barriers to entry. Rather than take an unpaid internship writing code, I can write code at home. But what he wants to provide to aspiring journalists is a space in the locker room after games, access to practices, players and coaches, etc. That's very different.

Also, the premise wasn't useless and unneeded. It was not financially viable. In Cuban's article, he mentions plenty of reasons why it would be useful. But they aren't enough to justify the cost of starting such a project.