Microsoft (Nasdaq: MSFT) is going open source, at least for governments that want to inspect its Windows operating system.

Through an initiative called the Government Security Program (GSP), the company will give governments and governmental agencies controlled access to Windows' underlying code. For a company that has always zealously guarded its intellectual property, this is significant. Microsoft has opened up its code in the past, to some extent, but this program goes even farther.

The software giant will allow governments to review and judge Windows' security for themselves. Access will be free, and participants will actually make changes to the code, if necessary. Most of the changes are expected to be security-related and will vary from agency to agency. In addition, Microsoft will reveal technical documents and provide other support for the program.

Why is Microsoft doing this? Simple: competition. (And who said monopolies don't compete?) Some government agencies in Japan, France, and even the U.S., for example, are considering switches to cheaper, less buggy, more secure software, such as Linux. Some have already jumped ship: IBM(NYSE: IBM) signed a deal with Germany last summer to provide Linux-based systems to some governmental agencies there.

Microsoft wants to prove its software is trustworthy, since that's obviously a top priority for governments. It's a top priority for the company, too, as Windows routinely comes under fire for security flaws. Microsoft has focused more on improving security and the perceptions of its security over the last year.

This move is the company's most extreme yet, and will likely garner the response it wants. Already, Russia and NATO have signed GSP agreements with Microsoft. The company says it's discussing the program with more than 20 other governments, and it has a list of 60 with which it would consider signing agreements.

By opening up, Microsoft may just end up locking down the governmental software market.