To reduce instances of "casual copying" (a nice name for software piracy), Microsoft has implemented a two-stage antipiracy scheme in its upcoming OS. The first stage is the installation and registration counter: this lets you install Windows XP only five times on the same system. (Note that you'll be able to install the final version of XP on only one machine, as opposed to the current beta, which can be installed on five machines for testing purposes.) The second stage creates a profile of the system to prevent you from reinstalling or registering the OS on different PCs.

To make this scheme work, you must activate your copy of Windows--over the Internet or by calling for an activation code--within 30 days of installation. Activation differs from a classic registration process in that no personal information is requested by or sent to Microsoft, just a record that a specific copy of Windows XP is installed on your specific PC. If you fail to activate your copy of the OS within 30 days, your login will fail. (Since XP is based on Windows NT-like privilege levels, you can't use your computer until you log on.)

Microsoft says the scheme should not prevent you from reinstalling your copy of XP on your PC as many times as you need to, as long as it's the same PC or close to it, allowing for some hardware changes. It's the "some" that has most folks worried. In theory, you might have to reactivate your OS if you upgrade significantly or swap out a lot of components because XP might think it's running on a new PC. So far, Microsoft isn't saying what system information the OS uses to determine the "same PC or close to it" status. That means we don't know to what degree you can upgrade your hardware before you cross the invisible line. We also don't know how much, if any, personally identifiable data Microsoft is gathering from your PC.

Microsoft says you can, of course, change at least one and possibly several hardware components--RAM, video or sound cards, CPUs, motherboards, and so on--without having to reactivate your OS. But if you try to reinstall your copy of Windows XP on what Microsoft calls a "different or significantly upgraded or changed PC" (again, the company declined to specify how different), the activation will most likely be rejected, requiring you to call Microsoft to explain and get a new (free) activation code.

Microsoft plans to set up a new call center for U.S.-based customers to expedite activation issues. Many non-U.S. customers will likely have to go through the existing, shared Microsoft technical support lines they currently use. Microsoft says it expects only 2 percent of the total installed base of Windows XP to have to reactivate the OS. Whether the anti-piracy initiative will present problems for consumers or result in fewer upgrades to XP remains to be seen. Remember, the final release is at least a few months off.