There would basically be no software industry. There couldn't be because there would be no way to economically do it.

Software would thus only be made by hardware manufacturers- and would need specialised hardware for every task.

For evidence of this alternate reality I point to an era when thus was the case. In the 60s and 70s there were a number of hardware companies who all wrote the software for their specific machines. You paid for yhe hardware, not the software.

This model flowed into the fame consoles of the 70s (atari, intelivision and so on.) PCs started either this model, although software-only plays start appearing. They make money selling games, visicalc etc. Microsoft famously licenses Dos to IBM but non-exclusivly. Suddenly hardware is a commodity and clones appear.

All the big companies today are software companies. The cloud is proprietary software running on commodity hardware. The ability to grow, to make big bets, to develop is predicated on the existence of copyright.

But wait, Linux right? That surely negates my argument. Leaving aside the distinction that it's copyrighted, not public domain, Linux is a clone of a commercial system. That inspiration came from somewhere. It exists because Linus had a general-purpose computer, which arguably only existed because of copyrighted software.

Aside all that, original Linux was pretty primitive. It grew in part on revenues supplied by other software companies. While it would be fun to imagine a world with only Linux, it's harder to imagine how that world is funded.

SQLite is in the public domain. Its an example of what can be done. It's an amazing fantastic bit of software. For all that it's built on the proprietary work of others (SQL). And it's far less capable than proprietary database engines of the 90s (oracle, informix et al.)

So while I understand your viewpoint, it's also earth noting that copyright built the world we are in now, and the alternative would look very, very, different.