You may have used the prior versions of Windows. Frankly, piracy has continued to run unabated and this is Microsoft's response.
-> There are positive effects from registering. For instance if you do register a retail copy of XP then you can call in and get a replacement CD for very cheap compared to those that didn't register and 'lost' their receipts, etc.
Activation is another side effect of rampant piracy. It's a shame it had to come to this.
My new laptop periodically shows this information balloon in the task tray, wanting me to register Windows.
Do I need to do this? I don't remember registering Windows with my previous computers.