WGA Out, WAT In (Windows Activation Technologies)
When Windows XP was launched, Microsoft also release an an Anti-Piracy tool called WGA (Windows Genuine Advantage).
The tool is downloaded and installed when you run Windows Update on the first time or when you try to download specific tools or software from Microsoft Download Site that requires Genuine check. When Windows Vista was launched, WGA was still the tool that checked if your copy of Windows Vista is Genuine.
Windows Activation Technologies
On May 07 (2009), The Genuine Windows Blog, published a post regarding the activation experience in Windows 7. This activation experience is now called Windows Activation Technologies or WAT.
The make the story short, the team at Genuine Windows Blog are saying that the activation experience will be similar to the activation experience in Windows Vista SP1. That means, alert users that they need to activate their copy of Windows or help them if they are victims of software piracy, but will include several improvements designed for Home Users and Enterprises.
WAT for Home Users
The updated activation experience in Windows 7 for home users will include better ways to help customers make decisions with confidence about which action they should take. The Activation Technology in Windows 7 will be more descriptive about what Windows is actually doing and providing more information about what, if any, actions the user should take as a result of being a victim of software piracy.
WAT for in Enterprise and Large Organizations.
The updated activation experience in Windows 7 in the organization level will help IT Professionals to ease the burden of Windows Activation. One of the improvements includes support for activation in virtualization scenarios where KMS (Key Management Services) will count virtual clients, very important for customers who have fully virtualized environments.
The changes in activation notifications in Windows 7 can be found in the following post.
Additional Reading
Genuine Windows Blog - Windows Activation Technologies: Activation and Validation in Windows 7
Microsoft Technet - What's New in Volume Activation in Windows 7