That is Code OSS, MS official binary builds of Visual Studio Code, as explained at the top of the Readme, include proprietary code. MS also has several very popular proprietary extensions. Some of those extensions, older cersions were open source.
the old ‘embrace-extend-extinguish’ model is what it _truly_ is, f.e. , you cannot take extensions from m$ store and use it.
there have been large number of discussions around this topic, and folks have highlighted these concerns more articulately than i could ever hope to do.
The destructive EEE strategy is replaced by a constructive poisoning the well strategy. That's arguably moral progress while there is no legal or financial incentive to do so.
That's praise for Nadella, not Ballmer.