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Is there a way to avoid the data collection by changing the hosts file? What if I made microsoft.com point to localhost or 127.0.0.1?

Will the telemetry stop then?

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As the other guy said i wouldnt trust Windows that it does what i ask it to when i edit the hostfile. Next to that microsoft has probably a unlimited amount of burner domains.

Honestly if that bothers you, just don't use Windows.

here is a hosts file that tries to do just that: https://github.com/WindowsLies/BlockWindows/blob/master/host...

Edit: although some people seem to be claiming the Windows bypasses the hosts file for certain hard-coded domains, so you might have to block these domains at your firewall instead

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