You will be required to add a Windows Live account in Windows Phone 7. When signing in to your Windows Phone 7 with a Windows Live ID you will be for an activation code.
To do so:
- Press the Start button, flick left to the App list, tap Settings, and then tap email & accounts.
- Tap Add an account > Windows Live.
- If you haven’t signed in with a Windows Live ID yet, the Before you sign in screen appears. On this screen, tap Next.
- Tap the Windows Live ID box, and then type your Windows Live ID.
- Tap the Password box, and then type your Windows Live password.
- Tap Sign in.
- After tapping Sign in you’ll be able to see the same “Activation Required” screen, where you can enter your new activation code and tap activate.