Microsoft's Windows XP product activation process, which forces buyers to register their software online, is an attempt to stamp out piracy — but it's immensely unpopular one.

Research conducted by Microsoft in association with the Business Software Alliance has revealed that as many as 70 percent of UK small firms are running illegal business software.

In a bid to reduce the level of piracy, Microsoft has introduced 'activation' - a feature in Windows XP and Office XP that forces people to 'register' software via telephone or internet within a specified period in order to carry on using it.

"The key feature of activation is to strike a balance between protecting our [the copyright owner's] interests and those of the end user," said Allen Nieman, technical product manager on Microsoft's licensing technologies team at today's product activation press conference. "Activation is primarily designed to prevent casual copying."

Windows XP must be activated within 30 days of installation. After this period users will be reminded to do so by a popup screen and will not be able to use the software until they do so.

Microsoft claims pilots of activation have proved very successful.

But a poll carried out on PC Advisor's website reveals over half (51.2 percent) of all voters will not be converting to Windows XP until Microsoft removes its activation process.

Microsoft claims this is not what its research has shown. "The majority of our customers said [the activation process] is fine," said Julia Phillpot, security officer at Microsoft UK. "The feedback we had says that this just isn't a big deal. People who bought a legitimate product were happy to protect it."

Nieman cited mobile activation, where users have to ring up their operators to activate the handset, as a similar process already in existence. "People are only complaining because this is something new," he added.

But the key point which seems to be a major concern for consumers is the need for 'permission' from Microsoft to run the software, which becomes an issue when the user wants to reactivate software.

Microsoft's answer to this has been to introduce its 120-day policy, currently not available to Office XP users. Once the software has been activated on one machine, users will have to wait 120 days before they can transfer it and use it on another machine (known as reactivation). If they wish to reactivate the software earlier than this, customers must contact Microsoft directly to get permission.

But Nieman has admitted Microsoft is relying on the honesty of its customers for activation to be effective and admits illegal activation of the same program on several machines "is possible". This appears to undermine the point of such antipiracy initiatives.

Microsoft is adamant it will not remove its activation process, saying it is part of its policy to educate people about software piracy and insists its customers don't mind the process.