Windows 7 OEM software licensing question

I want to buy a copy of Windows 7 Pro before they all disappear.
I have seen advertisements for Windows 7 Pro OEM versions.
Please explain OEM licensing to me.

Specific questions I have:
Q1.)  if I buy an OEM copy, what happens if I install it on a used pc?

Q2.) Let's assume I install OEM copy on used pc #1.  This pc dies. I discard pc#1  I purchase a different used pc (pc#2)  What happens if I install the OEM copy from pc#1 to pc#2?

Please share any other thoughts you may have concerning OEM software.
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Alan HendersonRetired marine engineerCommented:
OEM stands for Original Equipment Manufacturer. It's only supposed to be sold with PCs or motherboards, or disk drives - maybe a few other things.

Once installed it's tied to your setup. If you make major changes to your PC, like change GPU for instance, Big Brother Microsoft will detect the change and you'll have to call them up to re-authorize your installation. They're very flexible about it.

You can't legally install the OS on a different machine if the first one goes belly-up, but if you spin a believable story on the freephone line they'll usually re-authorize it.

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Alan HendersonRetired marine engineerCommented:
Should have added, retailers are not supposed to sell OEM versions unless it's with a qualifying piece of hardware, but they all do it, Microsoft knows they do it, Microsoft does nothing about it, so I guess it has tacit approval.
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VB ITSSpecialist ConsultantCommented:
Q1.)  if I buy an OEM copy, what happens if I install it on a used pc?
You can install it on a used PC but I wouldn't recommend this as once it's installed on a machine it is tied to the hardware on that PC. That means you can replace components in the PC and reformat (you'll need to contact Microsoft to re-activate Windows when you do this) but you cannot transfer the license to another machine.

Q2.) Let's assume I install OEM copy on used pc #1.  This pc dies. I discard pc#1  I purchase a different used pc (pc#2)  What happens if I install the OEM copy from pc#1 to pc#2?
You can install it but you won't be able to activate it. This is also a breach of Microsoft's licensing terms so ethically it's not recommended. Some people call up and are able to get away with it but if MS do an audit you may find yourself in trouble.
According to the license, it must be installed on a new PC, not a used one. After that you sell the PC, and you are responsible for any customer support, not m$. So OEM are to be sold, not kept by you. But on all these points (except the support) m$ has been tolerant. So I haven't heard of anything happening if you install it to an old PC or keep it...

As mentioned already, you aren't allowed to move the OS, once activated, to another PC. It would need re-activation, so you can't activate it with the same key. There are some exceptions here though. If you change the mainboard of the PC with an identical model of your broken board, or with one from the manufacturer that was qualified as an identical replacement, then you can re-activate by phone. Or if you live in the EU or Switzerland, you can move the OEM OS to another PC and reactivate by phone, as in those countries the OEM license isn't regarded as legal.
in short - for what you want to do - better use a retail licence
donpickAuthor Commented:
Thank you for your prompt answers.  I pay for this service so I appreciate prompt answers.
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