4) Tailscale can benefit from innovations that Headscale finds.

Competition can be beneficial for all parties involved. If the Headscale devs make novel contributions and solve problems Tailscale didn't think of or figure out themselves, Tailscale can copy Headscale just as Headscale copies Tailscale. Competition has this benefit of distributing research expenditures.

I think it is easy to forget that even monopolies are bad for monopolies. They can benefit by being fat and lazy, but this is at the cost of larger future profits. It's "safer", but there's plenty of competitive markets where there is little risk of failure. At least compared to the risk that naturally exists.

5) Headscale users may convert to Tailscale users.

That can happen if Headscale was implemented by a enthusiastic employee who later leaves. Company learned to like the benefits but no longer has the support. This makes a natural conversion. The same thing happens if Headscale fizzles out.

I really just don't see how Tailscale really has much, if anything, to lose from Headscale. It definitely has things to gain! The only reason to go after Headscale would be if they are greedy and irrationally fearful. Which the action itself would scare a lot of its users. Tailscale really is in touch with its users and honestly, I'm not sure there's anything negative I have to say about them. They're not creating enemies, they're paying attention to users, and they're just focusing on making a great product. Seems like the ideal strategy that we'd want all businesses to follow.

As I understand it, headscale was implemented by an enthusiast user who became an enthusiast employee, who is allowed to spend work cycles on maintaining it.