As our computing lives continue to become ever more connected, what data is being shared with who is continues to be at the forefront of privacy conversations. Even for those users who may be savvy with Windows, it can be difficult to tell on the surface what data is being sent to Microsoft, even after perusing through the privacy menus. The good news is that Windows isn't a black box; thanks to public documentation and network analysis, we know what data is being sent, and how to stop it if you so choose to do so.
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What is telemetry actually used for?
Windows collects quite a bit by default
Telemetry data covers the basics of your system and doesn't include any explicitly identifying information about you, the user. Things like what hardware is in your computer, what software is installed, and system events. Windows refers to this information as "diagnostic" and some of it is either buried in system settings, or can only be truly disabled with registry tweaks. This telemetry data is encrypted and transmitted via HTTPS, and is usually done periodically or when an important event occurs, like a system crash.
To be clear, mandatory Windows telemetry doesn't explicitly collect things like file names or the files themselves, emails, or any other data that could be used to personally identify you. Microsoft says it uses this data to help improve their services. The non-mandatory data collection, while still in the realm of anonymity, is where things can get a little more uncomfortable for some users.
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Optional data-collection, and how to turn it off
Most of the more invasive collection can be toggled off
Upon first boot, Windows will take you through the initial configuration for some of the core parts of your PC, and one of those configuration screens contains toggles for all the optional data collection. These are all toggled on by default, but Microsoft is legally required by regulations in some regions, like GDPR, to show users what data is being collected and gain their consent before they start using Windows. This is where you'll be able to toggle off collection for things like typing and drawing data, location data, app usage data, and crash reports.
If you skipped through this initial configuration screen, you can still change these settings in the Privacy section of the Settings app, but as far as toggling off the "required" data collection, that takes some poking around in the registry, or can be done with third-party scripts and tools. Enterprise editions of Windows have much more granular control over data collection compared to Home and Pro versions.
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How does it compare to other operating systems?
It's more or less the same compared to macOS
When you compare the two tech giants and how they handle privacy, it's largely the same, with a few key differences. Apple handles optional macOS data collection largely the same, with app analytics, Siri dictation data, and location services often being handled on a case-by-case basis. Apple does emphasize more on-device processing of these diagnostics, but some data does make it to them, largely anonymized. The exception to this is data collection surrounding one's Apple ID or iCloud data, which is (for obvious reasons) not anonymous in its nature. As far as mandatory, non-togglable data collection goes though, Windows does a lot more, plain and simple.
Linux does the least data collection out of any OS, and that's largely because of its decentralized nature. Large distros will sometimes prompt for crash reports or other diagnostic information, but by default, most Linux distros collect little, if any, data from their users.
Microsoft's general stance on privacy has been fluid over the last few years, especially with the advent of new Windows features like Recall. While they've outwardly expressed the best intentions for user privacy, their handling of user data in recent years has invited harsh criticism from privacy advocates.
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It comes down to what you're comfortable with as a user
Microsoft does collect a fair amount of data from Windows users, both optional and non-optional, for diagnostic and marketing purposes. You can control the vast majority of it, but without digging around in the registry or using third-party tweaks, there will always be some level of collection happening on your PC.