Microsoft actually offers Windows 10 for free, with some cosmetic restrictions until you pay for the license.
This is also why "Windows is a service" according to those Windows Update nag screens, but if Windows is a service and it's free, are you the customer... or the product?
To the question: I have a watermark in the corner of my screen saying I need to activate, and I am unable to change my desktop background and some other things. Besides that, the OS is functioning normally.
It's odd because a decade ago I would've probably been fine with it, too.