Licensing question when converting to virtual

I have 3 servers running Windows 2003 server that I converted to virtuals using vmware converter.  When I boot up it says that I must activate or it will not boot up.   My issue is I do not want to make the virtual image production right away as it is full of viruses, etc and needs cleaned up.  I would like to convert to a virtual and figure out the best way to clean up and keep the physical running until I have a plan.  My question is if I enter the product key within the virtual will this cause issues for my physical that is still running or a license violation of any sort with MS?
jcs1977Asked:
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LegendZMPrincipal Security ArchitectCommented:
Virtualization licensing is a little different with Windows Server 2003.
http://www.microsoft.com/windowsserver2003/howtobuy/licensing/calculator.mspx


In short, Standard Edition, (I believe) you will need to purchase each individual copy as you go.

Enterprise, each REAL license you purchase can be used for up to 4 additional virtual machines with that key.

Datacenter edition allows for a one time fee(per processor) and unlimited virtualized copies.
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Rob WilliamsCommented:
You will need to enter the licensing key to boot. If they don't activate, which is possible where it will be seen as new hardware, you will have to call Microsoft using the phone activation. And yes, unless it is Enterprise 2003 it is a licensing violation, though I appreciate your predicament.

With a clean install you would have a 30 day grace period to activate. Perhaps choose the phone activation and explain the issue to Microsoft. Regardless if it activates, it is an honor system to shut down the other machine as soon as possible. SBS actually has a built-in "time bomb" that allows you to run both for 7 days for migration purposes, and then one starts rebooting (actually the reasoning is a little different but the concept is the same). They actually have a patch to extend that to 21 days, so obviously Microsoft is sympathetic to the issues involved with migrations. You could run into issues though if they are OEM licenses which are tied to the original hardware.

I wonder if your CAL's transfer OK with the VMWare converter? I would think so.

Keep inmind you cannot run the physical and virtual on the same network or you could have all sorts of problems.
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HeinoSkovCommented:
If youre using VMware DRS/HA you should definately go for the Datacenter editions.

The reason is that on Standard edition (and in some scenarios Enterprise Edition) it is not legal to move a Microsoft VM to another hosts more than once per 90 days.

On Enterprice Edition you have 4 copies of Windows for Virtual Machines - but the same rule count for VMotions. This scenario is a little complicated to describe, because up to 4 VMs is allowed to move to another hosts - but only if that hosts has less than 4 VMs running. If you go more than 4 VMs per hosts you need 2 Enterprise licenses.

If you purchase Datacenter licenses for your ESX hosts - you can move VMs between your hosts all you want.
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