"Some people have multiple PCs at home, and this allows them an easy way to put them on multiple machines," said Jim Cullinan, Windows XP lead product manager.
People can purchase additional "family licenses" at the time they buy Windows XP, either the upgrade or the full version, Cullinan said. The licenses are expected to cost $10 to $30 less than the full product price.
Later on, Microsoft plans to make the licenses available online and to offer additional license options with some networking products.
The discount is an attempt to compensate for a new security feature in Windows XP, Product Activation, which will for the first time prevent home users from installing the same copy of the software on multiple PCs. Product Activation will also require customers to obtain a code to reactivate the software if the computer Windows XP is installed on is significantly upgraded or if the hard drive is reformatted and the operating system is reinstalled.
Many customers previously bought a single copy of a new Windows OS and used it to upgrade several machines, usually because they were not aware of or chose to ignore licensing restrictions on multiple installations.
Product Activation is a key part of Microsoft's crackdown on piracy, much of which is unintentional. The feature has attracted widespread criticism from privacy advocates, who worry it will allow Microsoft to collect information on customers. It also worries PC users who frequently tweak their systems, who fear that upgrading their systems will result in frequent tangles with Microsoft.
Microsoft introduced product-activation technology with an update to Office 2000 but made it standard fare with Office XP, released in late May. In the case of Office XP, people can open the software programs 50 times before activating the product by phone or over the Internet. The process "locks" the software to the person's specific PC configuration.
Windows XP must be activated within 30 days by using an included activation wizard to connect to Microsoft online, "locking" Windows XP to the existing hardware configuration.
If Windows XP is not activated within 30 days, it stops working and directs customers to the Internet to automatically activate the software. To reactivate the software in the case of reinstallation or due to too many hardware configuration changes, a 44-character code must be obtained from Microsoft by telephone.
News.com's Joe Wilcox reported from Washington, and staff writer Matthew Broersma reported from London.