According to whom? It is open source in the measure that you're allowed to fork and redistribute your modified version. That satisfies the open source definition. If those plugins are open source themselves WPE can set up their own repository and point to it. If it's not, well, they decided to bet on something that could be taken off their hands at any moment.
You may say that this goes against the open source spirit, but that's a different thing. Wordpress is, by any reasonable measure, Open Source.
> WP Engine customising the admin panels, branding and other components to change the experience of Wordpress as they see fit. Isn't that the point of open source?
Sure, but...
> In the same spirit, I can also argue that Automattic doesn't really provide 100% open source Wordpress' experience either - It has many walled features across different price points.
No. The difference is Automattic owns Worpdpress' copyright, WP Engine doesn't. Also, does Automattic claim they provide a 100% open source Wordpress experience?
Let's be clear: I'm not defending WP's actions here (I think what they did is just plain dumb), and I don't have a horse in this race, but here we're conflating what would be ideal (everything is FOSS, Automattic releases everything they do and they compete only on service) with the reality that Automattic is a business and it pursues its own interest. Maybe they're pursuing it in a way that in the end will do them and the ecosystem more harm than good, but what they're doing is just business, and has nothing to do with the definition of open source.