The Open Source Initiative (OSI) has formally approved two of Microsoft's licenses:
Michael Tiemann of OSI writes on the process:
The decision to approve was informed by the overwhelming (though not unanimous) consensus from the open-source community that these licenses satisfied the 10 criteria of the Open Source definition and should therefore be approved.
The formal evaluation of these licenses began in August and the discussion of these licenses was vigorous and thorough. The community raised questions that Microsoft (and others) answered; they raised issues that, when germane to the licenses in question, Microsoft addressed. Microsoft came to the OSI and submitted their licenses according to the published policies and procedures that dozens of other parties have followed over the years. Microsoft didn't ask for special treatment, and didn't receive any. In spite of recent negative interactions between Microsoft and the open source community, the spirit of the dialog was constructive and we hope that carries forward to a constructive outcome as well.
In short, Microsoft played by open source's rules on this one and so was treated as a full open-source participant. In other contexts, with different behavior, Microsoft will be treated much differently.
Let's be clear, however: this OSI certification is not a blanket certification of Microsoft or its licenses. Microsoft had two licenses approved. Its software is only open source to the extent that it licenses said software under these two licenses. The rest can be proprietary, shared source, or whatever euphemism for "closed and proprietary" that Microsoft cares to use. Only Microsoft software licensed under its Microsoft Public License or its Microsoft Reciprocal License deserves to be called "open source."
Disclosure: I am on the board of the OSI.