There is no 'need'. It doesn't even work to prevent piracy, as a quick search for Xtreme at the usual file-sharing sites will demonstrate.
But I'm not here to argue about the specifics of Magix's protection scheme, or produce a bunch of forum drama; there is no point in doing that. For me personally, any 'activation' requirement, whether a lenient one or one as explicitly restrictive as three installations is entirely unacceptable. I've enjoyed using Xtreme and its ancestors back as far as ArtWorks, but I do not choose to spend money on software I have to get permission to run. I've been bitten that way before and it's not happening again.
(You are welcome to delete my account for mentioning piracy now, if you like. I'll not be posting further.)
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