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To function properly, Cortana collects an enormous amount of personal, identifiable data, as stated by Microsoft in its Cortana, Search, and Privacy FAQ:
“When you use Cortana, Microsoft collects and uses information including your device location information and location history, contacts (People), voice input, searching history, calendar details, content and communication history from messages and apps, and other information on your device. In Microsoft Edge, Cortana collects and uses your browsing history.”
“And other information” is particularly disturbing, because it could pertain to anything, and at the very least adds “speech and handwriting patterns, and typing history” to the data collected, as stated in the Getting to Know You section of Windows 10 privacy settings. It should be noted, however, that recording this data (however it’s limited or not) is not restricted to only Cortana, because in the same section, Microsoft states Windows itself also records such information.
There are two methods of disabling Cortana. Disabling the Getting to Know You option turns off Cortana and stops collecting associated data in Cortana and Windows itself, which also means dictation will cease to function. If, however, you just want to stop collecting data in Cortana, you can disable only Cortana in the Cortana search pop-up.