Could they do it? Deactivate Windows licenses, block Cloud services, access to Office 365 and whatnot?
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Yes, IIRC they already did this for Russia.
Not really, they just made it harder to get windows and office
You can install and use windows just fine, but you can’t download it from Microsoft
The online office installer will not work in Russia (it also adds a registry key, so it won’t work even with a VPN)
The offline office installer works fine
Activation seems fine