In the next week or two, Windows Update will list a new, "Important" update for you to download. It'll be called "Windows Activation Technologies Update for Windows 7," and if you're running a bootleg copy of Windows 7, beware.
The optional update will sniff out 70 "known and potentially dangerous activation exploits" that are meant to distinguish a genuine copy of Windows 7 from a pirated one.
However, if you're busted with a bootleg, it's not that big of a deal. Microsoft promises that none of your personal information will be sent to them. Instead:
If any activation exploits are found, Windows will alert the customer and offer options for resolving the issue – in many cases, with just a few clicks. Machines running genuine Windows 7 software with no activation exploits will see nothing – the update runs quietly in the background protecting your system. If Windows 7 is non-genuine, the notifications built into Windows 7 will inform the customer that Windows is not genuine by displaying informational dialog boxes with options for the customer to either get more information, or acquire genuine Windows. The desktop wallpaper will be switched to a plain desktop (all of the customer's desktop icons, gadgets, or pinned applications stay in place). Periodic reminders and a persistent desktop watermark act as further alerts to the customer.
It is important to know that the customer will see no reduced functionality in their copy of Windows – a customer's applications work as expected, and access to personal information is unchanged.
Of course, even if your Windows 7 copy is completely legitimate, there might be good reason not to download the update. Windows validation has been known to mislabel legit copies of software as pirated, which even if rare, is a pain that nobody wants to deal with. [The Windows Blog via ZDnet]