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Can I transfer my OEM version of Windows to another PC?

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Can I legally transfer my OEM version of Windows to another PC?  (AKA - Can I put a new systemboard in my OEM PC?)

Few of us are both IT and legal experts but we all have our own views of Microsoft's licensing rules and how they apply.  There are frequently questions on this site about OEM versions of Windows and whether it is possible to either transfer the operating system of an OEM system to another machine or to continue to use the OEM system installed on a PC after significant hardware changes to the computer.

The purpose of this article is to allow the E-E community to reach a consensus view on Microsoft's intended interpretation of their OEM EULA's for operating systems.  That is, even if it is physically possible to move the system, is it legal to do so? Feel free to post your own views and links to supporting evidence.  I intend to update the body of the article regularly based on any comments added and then this article can be used to help support comments in threads in the Operating Systems Technical Areas.

Below are some pointers from Microsoft supporting the view that an OEM Windows installation cannot be transferred to another system or continue to be used if the system board has been replaced (unless the system board is replaced with a board supported by the OEM).

I've included links to the articles - as Microsoft relocates documents on a regular basis please post any dead links for updating.

I hope you find this helpful and feel able to contribute your own comments for inclusion.


OEM and FPP - vive la difference!

Education Operating System Licensing Q&A

From: http://download.microsoft.com/download/4/e/3/4e3eace0-4c6d-4123-9d0c-c80436181742/oslicqa.doc.

6. What is the difference between OEM product and Full-Packaged Product (FPP)?

ANSWER. OEM products are intended to be preinstalled on hardware before the end user purchases the product. They are “shrink wrapped” and do not come in a box like the retail products do. Full-Packaged Product (FPP) is boxed with CD(s), manuals, and the EULA and is sold in retail stores in individual boxes. The End User License Agreements (commonly referred to as “EULAs”) for OEM and FPP products are slightly different. One main difference is that an OEM operating system license (such as the license for Windows) cannot be transferred from its original PC to another PC. However, the FPP version of Windows may be transferred to another PC as long as the EULA, manual and media (such as the backup CD) accompany the transfer to the other PC. Also, when a customer purchases an OEM product, the OEM license requires the OEM to provide support for the product.


9. Can I transfer my operating system license from an old PC to a new one?

ANSWER. Not unless it was purchased as a Full-Packaged Product from a retail store (i.e., Windows in a box). Current OEM licenses for all Microsoft operating system products are not transferable from one machine to another. The End User License Agreement (EULA) governs the terms for transfer of licenses. Some EULAs for copies of certain older OEM operating system products (i.e., MS-DOS®, Windows® 3.1, and Windows for Workgroups 3.1) distributed in 1995 or earlier may permit transfer of the OEM operating system software license under limited circumstances. (See Software Product Transfer section of your End User License Agreement.)

10. If I “retire” a PC with an OEM license on it, can I use that software on a new PC?

ANSWER. No. To put it simply, OEM product is “married” to the original PC on which it was installed. Current OEM licenses are not transferable from one machine to another. The software cannot be moved from PC to PC, even if the original PC it was installed on is no longer in use. This is true for all OEM software – operating systems and applications.

11. Rather than purchase completely new PCs, my organization performs in-place upgrades to the hardware on many of our computers. We often times only replace the motherboard, processor, and memory. Since the COA is still on the case and the OS is still installed on the hard drive, this computer is still licensed, right?

ANSWER. Generally, you may upgrade or replace all of the hardware components on your computer and maintain the license for the original Microsoft OEM operating system software, with the exception of an upgrade or replacement of the motherboard. An upgrade of the motherboard is considered to result in a "new personal computer." Microsoft OEM operating system software cannot be transferred from one computer to another. Therefore, if the motherboard is upgraded or replaced for reasons other than a defect then a new computer has been created, the original license expires, and a new full operating system license (not upgrade) is required. This is true even if the computer is covered under Software Assurance or other Volume License programs.

12. If I upgrade some of my PC components, do I have to purchase a new operating system?

ANSWER. The answer depends on the components that are upgraded or changed in the PC. The operating system licenses must remain with the device that retains the motherboard, chipsets, and chassis that include the serial number of the device. The operating system may be installed on a new/replacement hard drive as long as the operating system is first removed from the old hard drive.

Please refer to the section on “Modifications to hardware and how they affect the activation status of Windows XP” in the following link for a more detailed explanation regarding specific hardware changes. The same hardware component changes that can be made to a PC before requiring re-activation of Windows XP are the same changes that can be made before a PC is considered to be “new” - and when a new license for OEM software is required.

Microsoft® Product Activation for Windows® XP

From: http://download.microsoft.com/download/2/1/6/21654b16-6c81-4d96-9390-5203cd43d07d/WindowsProductActivationTechnicalMarketBulletin.doc

Modifications to hardware and how they affect the activation status of Windows XP

Product activation rechecks the hardware it is running only to help reduce illegal hard disk cloning – another prevalent piracy method. Hard disk cloning is where a pirate copies the entire image of a hard disk from one PC to another PC.  At each login, Windows XP checks to see that it is running on the same or similar hardware that it was activated on.  If it detects that the hardware is “substantially different”, reactivation is required.  This check is performed after the SLP BIOS check discussed above, if the SLP BIOS check fails.  This means that if your PC is pre-activated in the factory using the SLP pre-activation method, all the components in the PC could be swapped, including the motherboard, so long as the replacement motherboard was genuine and from the OEM with the proper BIOS. As noted above, installations of Windows XP made using volume licensing media and volume license product keys (VLKs) will not have any hardware component checking.

What if the reason for the replacement system board is because the old one was defective?

Licensing FAQ

From: http://www.microsoft.com/oem/en/licensing/sblicensing/pages/licensing_faq.aspx

Q. Can a PC with an OEM Windows operating system have its motherboard upgraded and keep the same license? What if it was replaced because it was defective?

A. Generally, an end user can upgrade or replace all of the hardware components on a computer—except the motherboard—and still retain the license for the original Microsoft OEM operating system software. If the motherboard is upgraded or replaced for reasons other than a defect, then a new computer has been created. Microsoft OEM operating system software cannot be transferred to the new computer, and the license of new operating system software is required. If the motherboard is replaced because it is defective, you do not need to acquire a new operating system license for the PC as long as the replacement motherboard is the same make/model or the same manufacturer's replacement/equivalent, as defined by the manufacturer's warranty.
The reason for this licensing rule primarily relates to the End User Software License Terms and the support of the software covered by that End User Software License Terms. The End User Software License Terms is a set of usage rights granted to the end user by the PC manufacturer and relates only to rights for that software as installed on that particular PC. The system builder is required to support the software on the original PC. Understanding that end users, over time, upgrade their PCs with different components, Microsoft needed to have one base component "left standing" that would still define the original PC. Since the motherboard contains the CPU and is the "heart and soul" of the PC, when the motherboard is replaced (for reasons other than defect) a new PC is essentially created. The original system builder did not manufacture this new PC, and therefore cannot be expected to support it.


Other useful links:

Microsoft's OEM information pages: http://www.microsoft.com/oem/en/Pages/default.aspx

Michael Stevens' Blog on the Windows EULA: http://www.michaelstevenstech.com/oemeula.htm


Last Reviewed: September 2010
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by:Kevin Cross
MASQ,

Thanks for putting this together.  You have my personal Yes vote above.

I recently purchased an OEM copy of Windows 7 64-bit separate from my computer, and the wording was clear in some points but then gray in others.  It clearly stated that the PC that the license was loaded on becomes the one bound to this OEM for life, which is consistent with the copies loaded by hardware manufacturer; however, it made it sound like under certain circumstances like the failed motherboard that you could contact Microsoft and get your OEM license to transfer.  Maybe this falls under the FPP category since it is a boxed and not installed by hardware provider's enterprise media.

I don't profess to understand this as well as you nor your cohorts in the Windows XP community, but one strategy I used since on arrival to my current employer I found that they were purchasing OEM licensed PCs and they were all Windows NT at the time.  Being from a bigger organization, I was always use to having an Open agreement; however, I also knew the expense associated and the volume we had to qualify.  Upon research though, Microsoft had what is known as the Windows XP Pro Upgrade CAL which allows you to purchase PCs with OEM software, but take advantage of loading a corporate image.  

The advantages were we got newer versions of Windows cheaper, especially when you add SA, as over time you can continue to purchase Window home addition machines and upgrade them to Pro version under Open agreement.  It doesn't remove the OEM non-transfer rule, but as long as you have a very basic OEM license on the new machine you can move the Upgrade CAL.

Anyway, think this will be a nice discussion board for those of us that need to know how this works but are a little fuzzy on the topic.  

Thanks again!

Best regards,

Kevin
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by:younghv
This is really solid information and this Article NEEDS to be referenced about 10 times a day to correct some serious mis-information that is being passed all over the Internet.

Thank you for putting it together.

Big "Yes" vote above.
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by:garycase
I agree with Vic -- this is an important article that should be referenced MANY times.    There is a lot of misunderstanding about what it means to have an OEM license.
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by:DrDamnit
Important information for those of us without a juris doctorate.

Voted Yes above.
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by:tigermatt
+1

Great article. Thanks, MASQ!
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by:Tolomir
Just to annoy you:

See http://blogs.msdn.com/b/mssmallbiz/archive/2009/10/27/no-oem-microsoft-windows-licenses-cannot-be-transferred-to-another-pc.aspx

As you can see, the OEM Windows license is “locked” to the original PC it comes with and cannot be transferred to any other PC.  So in this instance, the new PC would require a full Windows license, not an upgrade license in order to be licensed to run Microsoft Windows.

** UPDATE: One of the readers of my Blog posted a comment to this post and reminded me of something that I had forgotten to include in the original write-up.  Yes, in Germany specifically, OEM licenses can be transferred.  This does apply to Germany specifically though, so everywhere else it holds true that OEM licenses cannot be transferred to a different computer.  Thank you for pointing this out and reminding me.  I appreciate that.

Tolomir
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by:captain
Big yes from me MASQ.

Thanks for the effort.
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by:pinascode
This is a great article. It is definitely a nightmare going through MS licensing.
On a different note, this does apply to the US only though, Germany for example has different laws. The big one is that MS cannot restrict people into using the OEM software and not transferring it to another machine later, or  by replacing the MOBO.
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by:cpaglee
Nothing below should be considered legal advice. No attorney client relationship is created by this answer to this question. This is just the personal opinion of somebody who happens to know a little about the law.

This is a very sticky question with no simple answer.

1. Not everything Microsoft puts in its EULA is legal in every jurisdiction. In the USA alone there are 51+ legal jurisdictions and then another 190+ country specific legal jurisdictions worldwide. In general Microsoft does not disclose which things are legal in which jurisdictions, so if you just read their EULA you may mistakenly be bound to many terms which are not legal in your jurisdiction / state.

2. There are things in Microsoft's EULA which may very well likely be held not legally binding in ANY jurisdiction. Microsoft has included these in their EULA but they have never been tested by a court of law so we literally don't KNOW what inside the Microsoft EULA is legally binding and what is not.

3. The very notion that Microsoft can "marry" a license to a piece of hardware would likely be found non-legally binding in many jurisdictions. Microsoft's logic is that the OEM is responsible for customer support of an OEM license. Microsoft's concern is if a user changes the hardware in their system what party will be responsible for customer support? Their logic ignores the obvious answer: Nobody! Most people who know how to change a motherboard can provide their OWN technical support and don't require any from Microsoft, the OEM or anybody else (save experts-exchange.com).

4. From a legal standpoint I look upon Microsoft as a morally reprehensible company. The software they ship is defective. Okay, we all knew that when we bought it, this I can accept. But their decision to discontinue support for software, this deep down in my bones is morally reprehensible. If Microsoft wants customers to upgrade to a new product make it better and customers will upgrade. From a CPU requirement, software availability and driver availability standpoint XP remains superior to both Vista and 7. If Microsoft does not want to support XP they should open the source code so that individuals can fix the bugs Microsoft has neglected or refused to fix. Microsoft's decision to end support for Windows XP is a huge mistake, IMHO, and may make them vulnerable to legal action, especially given Microsoft's judgment history in the courtroom.

5. The bunk that Microsoft puts on their website is just that: bunk. Until some lawyer decides to launch a class action lawsuit against Microsoft disputing the outrageous terms in their EULA nobody knows exactly what the actual legal requirements are. Microsoft would like you to believe what their lawyers write, but by no means does that mean their legal opinion is the law.

6. Microsoft's EULA has a loophole which allows damaged motherboards to be replaced when they are broken. OEM manufacturers will eventually replace your system with a brand new / refurbished system when they break if you are dumb enough to by extended service agreements. Its simple math because a new computer is cheaper than repairing 5 year old motherboard. They even do this with notebook computers! If an OEM can replace old hardware which is broken with new, better hardware as a warranty replacement can an individual do the same? I believe almost any judge would say "yes".

7. The best protection against lawyers is large quantities of CYA paperwork. When a system has a motherboard which needs to be replaced call up the OEM and find out the list price the replacement cost for a new replacement motherboard. Boards that are more than a few years old are often not available new. Keep your replacement purchase to within the list price of the replacement board from the OEM (which should be easy). Technicians should document all hardware modifications as system repairs, keep exhaustive documentation of these repairs and retain copies of the Microsoft XP licenses next to the computer systems along with the original Microsoft license in a bound folder for each system. With proper documentation Microsoft would have a very week case if they ever decided to raise an EULA enforcement issue. When technicians sell or otherwise dispose of old hardware they should make sure to document "Faulty, Does not work. Sold AS IS with no warranty and no software license" on the bill of sale and keep a copy of the "bill of sale" in their system documentation file. It is probably a good idea to keep a separate documentation file for each system with metal tabs to make sure no receipts, papers get misplaced. Most judges (outside Seattle) will not listen to Microsoft's explanation requiring replacement of a broken motherboard with a more expensive product with less functionality because of the Microsoft EULA.

8. If you find yourself in need of a new authorization from Microsoft for an XP installation call Microsoft and explain to them that your original hardware was faulty, did not work and the hardware replacement was made in line with manufacturer OEM requirements. Microsoft will issue you a new authorization code. If they provide you with a new authorization code you should have no problem. Just make sure the old hard disk never boots again.

9. There are many utilities available which make the installation of Windows XP much less painless. Google is your friend.

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by:teomcam
Unfair policy. Consequences of monopoly.
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by:☠ MASQ ☠
But you do get the OEM system for around $30 instead of the retail price of $150
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by:Neil Russell
BUT is it legal to buy an OEM copy of an OS on its own with no computer?
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by:☠ MASQ ☠
You can legally buy OEM "System Builder" disks - that is the Microsoft OEM version.  The myth that you must buy a bit of a computer at the same time is just that.

But there are rules that apply to being a System Builder - even if you do this as a "hobby" - including that you cannot supply yourself with an OEM licensed system where you are also the system manufacturer.

Newegg etc., sell OEM disks but how they are used is up to the purchaser.  (The extreme analogy is, "we only sell the guns" :))


http://www.microsoft.com/OEM/en/licensing/sblicensing/Pages/licensing_for_hobbyists.aspx

You cannot legally buy reinstallation disks from other manufacturers unless they are being sold with a PC ("For distribution only with a NEW <insert name of manufacturer here> PC")
UNLESS you have purchased them DIRECT FROM THE MANUFACTURER TO REPLACE LOST OR DAMAGED MEDIA.
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by:nat_nz
"Therefore, if the motherboard is upgraded or replaced for reasons other than a defect then a new computer has been created" riddle solved in my eyes.
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by:pinascode
The easiest and safest answer to this is to buy the Retail or FPP version of the OS, then you can transfer whenever and however many times you please. after 4 activations, you will still have to call the activation hotline, but besides that, you can legally transfer the Retail version of the product as many times as you like.
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by:younghv
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by:Fred Marshall
cpaglee makes some very good points regarding what may be and may not be enforceable license terms.
(I avoid the use of the word "legal" because it carries too much weight in the eyes of many.  For example, if one violates license terms, is that "illegal"?  Often not.  It is surely and simply a violation of the license terms.  It takes action to determine what the consequences of this violation of terms might be.  So you may be prevented from "Authenticating" an OS as a consequence.  Or, you may be threatened into buying another license as a consequence (how many have?) .  Or, you may be taken to court and then the court will decide the consequences. And, in some far-out cases, there may be civil or criminal charges levied by some government agency because the actions were allegedly *illegal*.  Do you really think that some government is often going to jump on this?  On what basis?)

One is advised: "Don't ask your lawyer: "Is this legal?".  Rather ask: "Can I do this?"
The difference is in the practical application of the law through enforcement.
So, I can spit on the street with relative impunity even though it may be "illegal" on the books of the city or town.  That's because nobody is going to enforce that law.  
One can ask the same about licensing terms.
Don't ask your lawyer "Is this in violation of the license terms?"  Rather ask: "What might happen if I violate this term in the license?  Anything?"  Often the answer is "nothing".

Now only you can decide if an action is morally defensible......

Here is food for thought re: the semantics:
From above:
You cannot legally buy reinstallation disks from other manufacturers unless they are being sold with a PC
Huh?  Of course you can legally buy disks.  They aren't contraband nor some controlled substance.  The situation here really is that they come with an attached license.  The real issue is "Can you buy licenses along with a disk and subsequently use those licenses / i.e. use the disks for installation and subsequently have the installed OS BE LICENSED".  
Is it illegal to not be licensed?  Or is it simply a state of being NOT LICENSED?
Maybe a better question is: "Can you legally SELL disks and promise licenses as well?"  

I'm not a Microsoft basher. I have no intent to cheat them or pirate from them.  And, I prefer to not be inconvenienced by their unenforceable terms.  The best result in doing a repair is to end up with an Authenticated system that is indistinguishable from "what it should be".  Preconditions like having holograms in hand seem silly to me.  What is the end result?  When the machine is inspected thereafter, where is the hologram now?  Burned, lost, stolen ....??  How can it matter?
Thus the comment about "terms" is well made.

Now, I suppose that an argument can be made that users are protected from difficulty and time-consuming effort if they know up front what will assuredly work.  I think that's what Masqueraid's paper here is about.  It's a real service.

I'll still quibble about "legal" getting back to the original question:
Can I legally transfer my OEM version of Windows to another PC?
Maybe this should be reworded:
If I transfer my OEM version of Windows to another PC, am I breaking any laws?
And maybe even better, it should be:
If I transfer my OEM version of Windows to another PC, can I retain the license for it?

These are just my humble thoughts.  If you like 'em then you take your own chances.
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by:garycase
None of those questions are the same as what the article addresses.

The article addresses the question, "... Can I legally transfer my OEM version of Windows to another PC? "     That is NOT the same as the title of the article, which reads "... Can I transfer my OEM version of Windows to another PC?" ... which may be why some expect a different discussion.

Note the missing word ... "legally"

Your question, "... If I transfer my OEM version of Windows to another PC, am I breaking any laws?" => is essentially the same question.

Your other question, "... If I transfer my OEM version of Windows to another PC, can I retain the license for it? " => certainly implies a legal issue (i.e. clearly you can "retain the license" ... so the implication is that you're asking if it's legal).

I think what many folks want to know is simply  "Will it work?"    i.e. will it install; activate; and authenticate okay?      Masqueraid already addressed this quite well in the article -- noting the distinction about whether it is "... physically possible to move the system ..." and if it is "...  legal to do so."

If one doesn't care about the legalities, you can always simply try it ... if it activates okay, it's clearly going to work => and I'd certainly agree with your comments r.e. enforcement.    It's rather unlikely that Microsoft is going to take legal action against an individual who installs an OEM license on a 2nd machine (i.e. a replacement motherboard) :-)    In theory, it shouldn't activate ... but if it does, then it's going to work - period.    It is, however, as the article makes clear, a violation of Microsoft's EULA to do so.
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