The Steinberg Key is a copy protection unit (dongle) which is needed to use Steinberg's software range. With Cubase SX/SL/SE, Nuendo and WaveLab the Steinberg Key is already included in the product package.
The Steinberg Key is also required to run Steinberg VST instruments, but is not included in the product boxes and must be purchased separately if no Steinberg Key is already present on the system.