Store: A Microsoft account is the combination of an email address and a password that you use to sign in to services like Hotmail, Messenger, SkyDrive, Xbox LIVE, or Outlook.com as well as products including Windows 8 PCs, Windows Phone and Xbox. If you have made a purchase from Microsoft online, you may already have a Microsoft account.
Live: Your profile contains personal and work info that you'd like to share with your friends. For example, you can share contact info, including email addresses, phone numbers, and street addresses for your home and work. You can also connect services like Facebook, LinkedIn, flickr, and Twitter to your profile
Greater connection between your devices and services
When you sign in with your Microsoft account, your Windows devices come to life with your stuff: people, email, photos, docs and other files, even your Xbox achievements, making your experience truly personal.
You are in control through enhanced safeguards to help protect from anybody who may be trying to access your account to steal your personal information.
If you used an existing email address to sign up, you'll need to verify it to prove that it's yours. For more information, see Why do I need to verify my email address?
Track your purchase history and subscriptions
Signing into your Microsoft account lets you see all of the purchases you have made from the Microsoft Store online, the Xbox console, and from the Windows Store, all in one place.