Same situation for me. I like everything about the way Microsoft is currently going except in terms of privacy, and it's a massive dealbrealer. Windows 10 has a lot of strengths but I'll never willingly use it until the privacy controls allow for all the 'phone home' features to be turned off. I just hope either Microsoft sorts it out before Windows 7 is no longer supported or an open source platform is polished enough to take its place.
It's enough to give me the impression that MS and other tech companies (Google, Apple, Facebook) are leveraging superiority in certain areas (with user experience and UI being chief among these) to try to ram privacy invasions and other very undesirable features down the market's throat.
Why? Some suspect a government push behind the scenes, but personally I think the answer is simpler and more economic: that data is extremely valuable to advertisers and advertisers are willing to pay a lot for ultra-fine-grained targeting services. Sure governments can piggy-back on all this to implement panopticon type surveillance, but the primary driver is demand for user data in the private sector.
The new business model of the tech industry is: give away free stuff and use it to productize the user. Maybe MS is extending this model to developers. (Facebook too with things like wit.ai.)
OSS can't compete. The problem with the OSS ecosystem is this: a product that works is only 10% done. The other 90% is making it work well and making it easy to use. It's not done until I can use it in minutes, not hours or days, and that takes a lot of painful work.
An example hit home for me today:
Today I was evaluating Microsoft LUIS and wit.ai and I realized that for simpler use cases a lot of what they do could be done with OSS like the Stanford Parser. The problem is that to make those work I'd spend at least a few days just getting that ball of twine up and running, let alone figuring out how to represent my app's intents and entities and such and actually get to something useful. But with LUIS or wit.ai I can do it in minutes to hours and have a ready to go app.
It's incredible. I can get natural language command and control in minutes!. The catch? Facebook or Microsoft get to mine every single bit of data I send and get a strong degree of lock-in.
There are OSS alternatives but they'd take days, weeks, or months to integrate... therefore they do not exist.
With regards to Microsoft's business model when it comes to Windows, you could be right about the advertising angle, but I believe some people would pay a premium to not have the advertising in their OS. If Microsoft offered the enterprise version of Windows 10 to the general public at a premium price then at least individuals who cared about privacy would have a valid upgrade option.