Thanks to @alex-k the wikipedia page describes:
Windows Error Reporting (WER) (codenamed Watson) is a crash reporting technology introduced by Microsoft with Windows XP.
And
In the Microsoft Windows Error Reporting (WER) system, crash reports are organized according to "buckets". Buckets classify issues by:
- Application Name
- Application Version
- Application Build Date
- Module Name
- Module Version
- Module Build Date
- OS Exception Code/System Error Code and Module Code Offset.
Ideally, each bucket contains crash reports that are caused by the same bug.
Edit:
Wikipedia page also mentions:
Not to be confused with the Dr. Watson debugging tool which left the memory dump on the user's local machine, Windows Error Reporting collects and offers to send post-error debug information (a memory dump) using the Internet to Microsoft when an application crashes or stops responding on a user's desktop.
Also this section is worth reading:
Impact on future software
Microsoft has reported that data collected from Windows Error Reporting has made a huge difference in the way software is developed internally. For instance, in 2002, Steve Ballmer noted that error reports enabled the Windows team to fix 29% of all Windows XP errors with Windows XP SP1. Over half of all Microsoft Office XP errors were fixed with Office XP SP2. Success is based in part on the 80/20 rule. Error reporting data reveals that there is a small set of bugs that is responsible for the vast majority of the problems users see. Fixing 20% of code defects can eliminate 80% or more of the problems users encounter. An article in the New York Times confirmed that error reporting data had been instrumental in fixing problems seen in the beta releases of Windows Vista and Microsoft Office 2007.