With the recent Windows Vista black screen of death, it got me thinking about what sort of measures I should go through to prevent unauthorized users from using the software.

While I don’t wish to burden legitimate users, I do want to prevent most piracy. How much copy protection is appropriate?

Is it acceptable for the software to phone home? If so, what data is appropriate to report on? The license key? Software version? What about a unique installation ID?

Should I disable license keys for small amounts of piracy, like when there’s 3 active installations of the software? What about widespread piracy where we detect dozens or hundreds of uses of the same license key? Would a simple message stating the software may be pirated with instructions on how to purchase a valid license be sufficient?

As a more general question, what licensing schemes have you seen that work the best?