Many customers were unhappy with the way Vista's Software Protection System and the compulsory WGA checks for XP worked, as there were initially bugs in the systems that would deem valid versions of the OS invalid. Hackers came up with ways to bypass the system not only for nefarious purposes, but also for users who were frustrated by system errors.
The OEM Bios exploit bypasses the check by mimicking what Windows looks like during a normal installation by an OEM, thus fooling the antipiracy check by appearing to be a genuine copy of Windows. The Grace Timer exploit allows a hacker to modify the 30-day activation system so an indefinite number of days or years can be set as the time the user has to validate Vista.
Microsoft also is building a feature into SP1 that can find new hacks in counterfeit systems and send out updates to Windows to stop new exploits before they can be used, Kochis said.
The pirating of Windows has been a perennial problem for Microsoft, particularly in developing countries where Windows is too expensive for many people to purchase. Microsoft and agencies that track piracy, such as the Business Software Alliance, claim piracy costs software vendors billions of dollars a year in revenue.
Microsoft began coming down hard on software piracy two years ago when it introduced WGA, which initially required users to validate their copies of Windows if they wanted to use Microsoft's update services. That programme expanded into the automatic validation built directly into Vista. Many have criticised Microsoft's antipiracy tactics not only for failing to work properly, but also for being generally intrusive, since they communicate directly with a user's PC and send information back to Microsoft.
However, Kochis said on Monday that Microsoft's antipiracy checks and other efforts to combat piracy - including lawsuits brought against alleged counterfeiters - are working. He said the rate of piracy for Vista to date is half the rate it was for XP during the same stage of its release cycle.