Surely Microsoft could just start recording with the with right windows update?Yes, they could. I get some scepticism when I say my businesses have declined to move to Windows 10, mostly because we don't trust the security and privacy aspects. However, we deal with personal data, and we also deal with various types of information that are protected by statute and/or contract. It would be very obviously against the spirit and quite possibly against the letter of several different laws for us to knowingly store and use that kind of data on a system that sends information we can't control up to the mothership and/or that could be updated without us agreeing to it. Indeed, there are multiple ongoing investigations into Windows 10 because of exactly those kinds of concerns across the EU right now.
It's a good thing that non-technical people who do take privacy seriously, such as lawyers, are starting to notice the glaring problem with these modern technologies and advise against using them. With a bit of luck, we'll then get statutory regulation requiring disclosure in advance of exactly what these devices are doing and the security and privacy implications including when they don't work properly or if they get compromised. Again, there had been much discussion in Europe recently, at least up until the world was more concerned with another kind of virus over the past few weeks, of requiring much stronger standards for security in IoT devices, and those sorts of laws really can't arrive soon enough. Mandating controls to physically isolate all cameras, microphones, transmitters and receivers at the hardware level might not be a bad idea, either.