Moving an OEM Windoiiws 2003 Server to a VM on a new server

I have an aging server running an OEM copy of Server 2003. It’s running a legacy application that may not run on any later operating system. Also reinstalling the application would cost thousands.

Virtualizing this server and moving it to our new Windows 2012 R2, Hyper-V server is the obvious solution. Because the OEM license isn’t supposed to move off of the old server it’s on, I’m willing to buy a 2012 R2 license and use it’s downgrade rights in the hope this will meet Microsoft’s requirements.


1.      If I buy a 2012 R2 license on our new server, can I use that license to legally move the OEM 2003 install to my new server as a virtual machine.
2.      When the 2003 VM is booted on the new hardware, it will want to authenticate I assume. Will authentication work?

Thanks for your help. If you're willing to call for clarification, I'm at 702.331.Three, Two, Seven, Three.
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Cliff GaliherCommented:
Keep in mind no licensing advice here is legally binding. I strongly encourage any licensing questions go straight to the vendor. The "I hear md it was okay on the internet" excuse just doesn't hold up in court.
With that said, yes you'd be legal. Yes, it'll want to re-activate, and yes that will fail. And here's the rub; MS does not provide keys for downgrade rights except for volume license purchases. And most retailers won't provide them either. Rock, meet hard place.

2003 is done. Baked. Dead. Time to spend those thousands and move to a supported OS. You got 12 good years out of a rather minor investment.
☠ MASQ ☠Commented:
Unless you're in one of the countries covered by the European Court ruling on OEM products your system isn't transferable to a different machine (including a VM) the activation will baulk at the new virtual hardware exactly as you have guessed.

However you can could change the ProductID for W2K3 using the same method as described in M$'s KB for XP to your downgraded 2012 R2 retail version which would then ask to be activated using a valid W2K3 retail key before activating.  The difficulty with that plan is, I believe, that as W2K3 went EOL in July it's no longer available as a Downgrade Rights option.

Licensing Disclaimer (c/o leew)
License information provided here is "best efforts".  The comments of the respondents are based on interpretation of the license agreements and their knowledge of the particular laws and regulations in their geographic location.  Laws in your location may invalidate certain aspects of the license and/or licenses can change.  "They told me on Experts-Exchange" will not be a valid excuse in an audit.  You need to contact the license granting authority to confirm any advice offered here.

The minute anyone explicitly tells you "Yes it's legal" or "No, that's illegal" ask to see their law degree :)
JohnMan777Author Commented:

I appreciate your work on this. Here are my next items:

1. "With that said, yes you'd be legal. "
2. "Yes, it'll want to re-activate, and yes that will fail."
3. "MS does not provide keys for downgrade rights except for volume license purchases"

For #1, can you post a link from a reputable source, hopefully Microsoft, to backup this claim?
#2 - I did a P2V and it did reactivate. It did not fail. It did take a call to India though. He said I "only" had 18 more times this would work.
#3 - I'm scheduled to buy a Volume License from Dell.

If I can get something proving #1, I can wrap this issue up.

Thanks for your help!
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Cliff GaliherCommented:
#1) Nope. If I could, I wouldn't have said "call Microsoft."  My interpretation isn't a simple link to a FAQ. It is in reading the EULA, making an educated distinction between a license (which is not transferred nor transferrable), and an OSE (which is what you are moving when  you virtualize.)  Microsoft recognizes this distinction and is how clusters work. When a clustered VM moves between nodes, the license isn't moving, *just* the VM.  Same concept here. I have sat in a room with MS legal before discussing this. I have stood on stage and presented on this topic. I cannot provide a quick link to that kind of education.

#2) (f you called India then activation failed. If it hadn't failed, you wouldn't have had to call. It is a nuanced distinction, but an important one.  It is good (perhaps lucky) that you got someone who was willing to manually override the activation without requiring a new key. Microsoft phased out that policy a few years ago, but not all call centers follow it.

#3) With volume licenses, you'll get keys online in the volume licensing center. with 2003 ending support, keys that old will soon nio longer be provided though (if they aren't gone already.)  MS ddrops them with the end of extended support.

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David Johnson, CD, MVPOwnerCommented:
You were extremely lucky. OEM software lives and dies on the hardware it is originally activated on. Don't plan on it working in the future with newer operating systems though.  It may not pass an audit though so be forewarned and forearmed.

Same concept here. I have sat in a room with MS legal before discussing this. I have stood on stage and presented on this topic. I cannot provide a quick link to that kind of education.
I would never present on that subject as (a) I am not a lawyer and (b) is is subject to the jurisdiction of the court which is normally Washington State. And legal fees are leagues above even a data center license cost
Cliff GaliherCommented:
It was an organized event and training with Microsoft's blessing. They do those every so often. Attendees and presenters had the appropriate disclaimers in place, all approved and signed off on by MS legal.
☠ MASQ ☠Commented:
Fundamentally though isn't the issue that, as Experts & MVPs we all do our best to stay up to speed with Microsoft's changes in licensing regs.  We attend (or even speak at) their presentations so we can give the best advice and then ultimately a random guy at a call center simply chooses to ignore current policy!  It's still no wonder that licensing is confusing to customers with these mixed messages!
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Windows Server 2003

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