I agree, the key phrase that caught my attention was "think of Windows 10 as a service". Which implies to me something you pay for on a yearly or month basis.
When they say free for a year, does that mean the first year of your "subscription" is free for windows 7=8.1 users?
Windows 8 was just a failed attempt for MS to mimic the Android and IOS ecosystem. Own the platform, own the store, shave money off the backs of app/content providers, let them do the work. The windows 8 experiment didn't work because they tryed to convert/force their existing userbase to this model and because the quality of the apps wasn't there.
With the traditional model, Microsoft makes money by selling it to device manufacturers and selling upgrades. Being able to sell upgrades requires Microsoft to constantly improve Windows and innovate to provide a reason for people to pay for an upgrade.
With the Windows as a service model, Microsoft is not necessarily forced to provide upgrades and innovate to keep the cash flowing in. Windows just needs to be good enough to keep people from switching to a competitors platform.
They may well be using the "Free Upgrade" to get people willingly into the Store for their OS.
If it goes this way, what this means for me as a tech, is now having to ask customer for their MS account info, their email address and password because they won't remember their MS account info, or having to call them to retrieve SMS codes. Alot of extra, inconvenient BS. More time being spent with customers getting account information figured out. Not looking forward to it. Already hate it with Office 2013. Doing this with the OS would bring it to a whole new level.