the more windows takes a shit on it's users the more major software companies start to look to Linux for the future. keep digging your grave Microsoft.
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I don't think users should be worried about this. Microsoft is not going to start crippling every desktop and laptop machine with this locked down version of Windows. And, even if they do, it's just a matter of time before someone finds how to unlock it and run every x86 program on it.
You are asking the wrong audience about "The race to the bottom."
Most people couldn't tell you if the have an i3 in their laptop or an Intel 13, and they are right not to care. Most people want something to do their spreadsheets and check facebook, they don't need anything more than that. And if they had more than that, the first time they get confused you know who they are calling...
Us.
The great unwashed of clueless PC users has got to be more than 50%. Windows 10 S is targeting that chunk of the market. And it's a big chunk.
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I believe you are exactly right. What does that mean for technical people who like control over their OS? Probably more of us will switch to Linux. Unfortunately while that may increase the "market share" of linux a little bit, it will not make that big of a dent in the over all market and mind share of developers attempting to target the largest base of customers.
This means sectors like gaming and professional desktop software will still be primarily focused on a platform that is increasingly becoming locked down and walled off with personal information being stolen with little real alternative and we will still be forced to use it (even in a VM) for the foreseeable future if you want any of those things.