You can use a Microsoft account to log into several Microsoft services. Amongst other things, this includes the online Office 365 software, the OneDrive cloud service, the Skype messenger and phone service and the Xbox Live games platform.
The advantage offered by a Microsoft account is that you are able to log into all Microsoft services using just a single e-mail address and password. You therefore don’t have to set up and remember several different user names and passwords. In addition, a Microsoft account facilitates the use of multiple Windows devices: Your activity history, cache, OneDrive plus various settings such as WLAN connections are automatically synchronised on all devices on which you log into your Microsoft account.
The drawback of a Microsoft account is data protection issues. You should be aware that Microsoft also collects data via your account: Locations, calendar entries, search queries, your browser history etc. These data are then for instance used to display suitable, personalised advertisements to you. If you don’t want this, it is better to use a local account.