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Software products that use online activation have their pluses and minuses.

It can make it harder for users to do sketchy things in general with the product in terms of usage and purchasing/sharing, and let us track more of what they were actually doing with our software. When a customer complains about something and requested a refund, we could always tell if the customer had tried activating on countless PCs before contacting us so we had an idea of how honest they might have been being before we responded to their complaint or refund request.

And we were able to have a policy that refunds were an option when no activation occurred but not when the user already activated (other than in special situations where a customer was particularly upset for a legitimate reason) since we had no way to stop them from using the product indefinitely once they activated.

Using online activation more or less eliminated piracy, which was great and we felt like one of only a small number of software firms that didn’t have a crack out there. However, it led to customers complaining about lack of Internet connection being a problem, so it’s good to have a solution for those without net access such as an offline activation scheme to use in special situations.

It also limited our ability to work with some distribution partners. We had to let it go to an extent when we entered retail stores since retail store users are less sophisticated than online users and definitely can’t be required to have Internet access.

In retrospect, while that opened us up to a little piracy, it was a good move overall. Being overprotective has its costs and in our case the distribution opportunities were worth the cost of a small % of users not paying for the product, esp. considering a good % of those type of users wouldn’t pay for our product anyway, given that they’re the type looking to steal it.

If you sell software into schools for example, not only will they often not have net access, but they often need a method to install the software program on many machines in a more or less automated way (silent install). The registration scheme must be simple and not require unique action on each machine in cases like this.

Also, one thing to consider is that if the registration process is too difficult, it can cost you money. Some companies can regularly get chargebacks simply because their customers are all to often unable to navigate all the steps required to complete registration.