The license is allowing you to perform specific actions. You can modify the work or redistribute it under the terms of "GPLv2 or later" without losing any of the rights the original copyright holder(s) passed on to you.
For a "modify and/or redistribute" example, under this "GPLv2 or later" licensing you can modify the software and use it in a SaaS without having to distribute it (which the GPLv3 would force you to), because you can choose to follow the terms of the GPLv2.
Likewise, you can use it and demand/assume implicit patent grants from the copyright holder, which the GPLv2 says nothing about, but the GPLv3 does.
Changing the license of the work is not modifying the work. That is the key difference. You must pass the same set of rights which you have received, like I said in other places. You can modify the work, but you cannot relicense the work. Only an original copyright holder can do this (for its part of the code).
When someone licenses software under the GPL (any of the versions), he/she isn't giving recipients any rights over licensing, he/she is only defining how the software can be modified and distributed.
Edit: To be clearer, a specific GPL version says you must pass that specific version's rights when you distribute. This makes it look like when you choose a version, you only need to pass that version's terms along. However, general copyright law (in most places) says you need to be explicit, so, if the GPLvX doesn't say you only need to pass those rights, then you need to pass those rights and any other (perhaps optional) rights.
> For a "modify and/or redistribute" example, under this "GPLv2 or later" licensing you can modify the software and use it in a SaaS without having to distribute it (which the GPLv3 would force you to), because you can choose to follow the terms of the GPLv2.
GPLv3 says absolutely nothing about SaaS. You're thinking of the AGPLv3. The only thing GPLv3 does in that regard is declare itself compatible with the AGPLv3, so you can combine code under those licenses.
For a "modify and/or redistribute" example, under this "GPLv2 or later" licensing you can modify the software and use it in a SaaS without having to distribute it (which the GPLv3 would force you to), because you can choose to follow the terms of the GPLv2.
Likewise, you can use it and demand/assume implicit patent grants from the copyright holder, which the GPLv2 says nothing about, but the GPLv3 does.
Changing the license of the work is not modifying the work. That is the key difference. You must pass the same set of rights which you have received, like I said in other places. You can modify the work, but you cannot relicense the work. Only an original copyright holder can do this (for its part of the code).
When someone licenses software under the GPL (any of the versions), he/she isn't giving recipients any rights over licensing, he/she is only defining how the software can be modified and distributed.
Edit: To be clearer, a specific GPL version says you must pass that specific version's rights when you distribute. This makes it look like when you choose a version, you only need to pass that version's terms along. However, general copyright law (in most places) says you need to be explicit, so, if the GPLvX doesn't say you only need to pass those rights, then you need to pass those rights and any other (perhaps optional) rights.