”Windows Live” refers to software for your PC (Windows Live Essentials) as well as a suite of web-based services (Hotmail, SkyDrive, and Messenger), and your account relationship with Microsoft (Windows Live ID). And, a host of other offers…… The naming confusion is one of the reasons Microsoft had to adopt new names for their services and decided to kill off ”Windows Live”. Microsoft account is now the identity service for individuals who use Microsoft products and services. You can use your Microsoft account to sign in to your Windows 8 PC, and then use the same account to connect to services like Xbox LIVE, Zune, and the Windows 8 app store. You can sign up for a Microsoft account with any e-mail address.
When you connect to a Microsoft account, you get connected to cloud services and 7MB storage space and automatically get SkyDrive, which is cloud storage for documents, photos, your phone’s camera roll, and settings from your PC. SkyDrive powers the Windows Phone camera roll, so every picture you take is automatically copied to your cloud photo album. All additional services can be connected if the app developer implements Microsft’s API and information can be shared across all Microsoft’s products and services; and are also accessible from any browser. That’s to say, for example your contact list will be shared across Windows Phone, Windows 8, Hotmail, Messenger, and SkyDrive, so that when you add a contact in one place, it shows up in the cloud and on all of your other devices and services. How cool is that!
Microsoft’ll be rolling out the change in nomenclature from Windows Live ID to Microsoft account over the next several months across their product line. There are still some areas they’re working on like migrating accounts (credit cards and purchase history) from one market (currency) to another for clients whose accounts are connected to services such as Xbox LIVE. See full story: http://blogs.msdn.com/b/b8/archive/2012/05/02/cloud-services-for-windows-8-and-windows-phone-windows-live-reimagined.aspx