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Actually I like the idea, with caveats. But first I'm quite certain that Windows 10 EULA allows this, and much more. So nothing new actually, just a new use of extremely invasive, but apparently legal, technology. Now, here are the caveats:
1) "permitted on the internet" this implies the computer is not being entirely disabled, just some parts of its functionality which depend on connection to Internet won't work anymore. Yes I know we all need Internet to do things we need to do, like fill taxes, chat to family etc. but if your bloody Windows is spewing viruses or DDoS-ing important infrastructure I do not give a sh*t about what you need it for. You are running Windows and by agreeing to EULA you allowed Microsoft to do whatever it wants to do with your machine, now go crying elsewhere (or go ask your friends for Mint Live CD)
2) backdoors. That's a big one, but how much of a backdoor would be actually needed? We are talking about installation or remote activation of a component rendering network component of a computer inoperative, and I argue that what Microsoft has done with Windows 10 users is by far much more intrusive than this. I do not think anything more intrusive would be actually needed and Microsoft already has PKI infrastructure in place for strong enough verification of a signature of any action they might want to take.
Now whether Microsoft abuses or not such a kill-switch is entirely separate discussion - even if they demonstrate the capability to abuse it, it would open them to whole lot of work ("cooperation requests") from law enforcement they might not like. I guess this is actually the question they are asking now - how much of a finger to give, without risking the integrity of the whole arm.
Good side-effect this might have, after 10 or 20 years of such technology no-one will even dream of attaching SCADA and other critical systems to Internet, or anywhere close where they might self-update or do anything else triggered by the vendor and not by the user. Or ideally, no-one will use Windows for anything critical.