In the most recent Windows Insiders build, third party ads were displayed but only briefly. They vanished as of the next update.
The company responded to the angry inquires that the sudden appearance of ads caused with the following statement: "This was an experimental banner that was not intended to be published externally and was turned off."
That's all well and good, but the simple truth is that if the company is even considering turning the banner back on legions of Windows users are going to break out the torches and pitchforks.
This isn't something that Microsoft should even be considering experimenting with because Windows isn't the only OS in town. Google, Apple, and maybe even Linux would happily soak up Microsoft's market share if the company were to decide to go that route.
Unfortunately, it wouldn't be unprecedented. Microsoft has run ads across other previous iterations of Windows in various places including the Taskbar, the start menu, and the lock screen.
Every time they've done it, it has generated considerable backlash.
The key difference between then and now is that there are other gigantic tech companies who are well-positioned to take market share from Microsoft and they would absolutely not hesitate to take advantage of any mistakes the company might make.
Windows 11 has the potential to be a game-changing OS. If Microsoft gets the launch right, it will secure the company's future for years to come. Unfortunately, as this recent gaffe demonstrated they are balanced on the edge of a knife. It is highly doubtful that their user base would tolerate ad displays in the new OS so the company needs to tread very carefully here.