It's the .NET framework and currently, you may have one or both of two
versions, 1.0 and 1.1. Techincally, you can delete it, whether or not you
want to is a different question. I'd recommend against it. It allows
programs built to run on the .NET framework to run on your machine, and more
and more programs will be written for this platform. Just look at all the
posts in this and the other Microsoft .NET newsgroups (not to mention the
zillion and a half web site out there dedicated to .NET) and you'll quickly
notice that a lot of energy and talent is being put into the framework.
Being a .NET developer, I'm a bit biased, but if you delete it, you probably
will find yourself not able to run something in the near future that you
want to run.
Does that answer it? If not, I can elaborate some more.
Bill