One frequently sees (on eBay and elsewhere) software for sale marked as “OEM” (Original Equipment Manufacturer). As I understand it, this is intended by the software company to be sold only when bundled with hardware - the package often says “not for resale.”
Sellers sometimes attempt to get around this by including some small, obsolete and worthless piece if hardware (e.g. a 14k modem board dating from 1994) when they ship the software.
I’d like to know if it is fully legal to buy and install such software. What are the considerations?
Well I only have very specific expertise with some of the software, but OEM software, as you mention is meant for distribution with computers or computer hardware.
I only have detailed experience with Microsoft products so I will speak on those.
First off Microsoft has 2 types of OEM product sales points. OEM is a large scale distributor along the lines of a Dell or HP. They buy the software to install and make copies for distribution on their own media packs. TGhis is why when you buy from them you rarely get the Microsoft OEM cd, but rather an “Install” or “Recovery” disk.
For smaller people, the mom and pop shops, you buy the System Builder software. This software is very similar to OEM, but rather than buying the content with the intet of distribution on your own recovery CD, tese people buy System Builder Packs (the shrinkwrapped manual/CD/License agreement packs).
Based on the MS license agreement for System Builder distribution, an Operating system must be packed with a fully functional computer or a non-peripheral component (defined as a component that is integral to the computer’s functioning. A hard drive, processor, etc.) a modem would not qualify.
Applications (like Office) or server software (like Windows NT or Windows 2003 server) must be sold with a fully functional system only.
System builders who break these rules can lose their system builder’s licvense which means they could no longer purchase the bulk OEM software from Microsoft.
What Xema didn’t mention is, it’s not up to you to comply with the distribution agreements of the supplier. That’s strictly between the publisher and the distributor. You’re doing nothing wrong, because you’re not violating a contract or copyrights or anything. The seller is violating a contract, but that’s not your problem.
BurnMeUp ,You sound very knowledgeable but I wonder why did Newegg say I qualified to buy XP Home OEM with just the additional purchase of a heatsink. Is Microsoft just looking the other way in regards to their rules?
I would say that the rules can be flexible up to a point. Say for example were NewEgg to argue that you can’t actually run a CPU nowadays without a heatsink, which is technically true, they could get around it.
In addition another rule of OEM software I forgot to point out. The Terms and Conditions specifically state the usage of that software is tied to the component with which it was sold, which means, that you can’t transfer ownership of the software without tranferring the component as well.
This is true. ANother tinkg I foprgot to mention is OEM software doesn’t come with the same “coverag” as a FPP (or Full Packaged Product). In the case of OEM software it is up to the OEM or system builder to provide any industry standard support. Which means Microsoft would not provide you any free support for the product. It would be strictly on a paid basis.
So, what are the rights of someone who purchases this software from the OEM? Say for example, I purchase a computer which comes bundled with Windows XP, but I already own a legally licensed copy of Windows 2000, which I install on the computer. Am I within my legal rights to resell the unused Windows XP software?
(I meant to attribute to BurnMeUp, not Xema – my apologies guys)
Fat Bald Guy, you may have a problem doing so if it’s a manufacturer’s rescue CD – it usually checks the computer to make sure it’s from the manufacturer.
However, if you have a full install CD that came with the machine, there may be license considerations that try to prohibit the sale or transfer of the software. On the other hand, if you don’t install the software you’re not bound by the license, so I think you could do whatever you wanted with it. Once it’s installed then whoever did so is bound by the license – not you. I’d argue that even if the software came with a heat sink, you don’t have to pass the heat sink on. Again, you have no contract with the software publisher, and you’re not bound by any license.
Also, licenses per se have never been tested in court. Could be that a lot of the provisions don’t apply, that is, those not dealing with copyright since that’s legislation and not license related.
No. The software is “attached” to that machine and that machine only. Of course, the chances of anyone getting caught or sued for doing this are miniscule, as most types are “person to person” piracy are.
Interestingly enough, MS has actually relaxed their OEM requirements for sales. Back in the late 1990s, you’d see website offering the “XP and a heatsink” pop-up and disappear seemingly overnight. Nowadays, reputable dealers like Newegg are doing it.
Based on the rules stated in the End Ures License Agreement (which apply to OEM systems when you open the documentation, not when you install the software) You are not allowed to resell the product because it is tied to the machine. If you sold the machine you could resell the product to the same buyer of the machine.
As mentioned above, no one’s going to kick down your door if you do it. This rule is mainly to keep resellers, wholesalers and other people who buy large quantities of software from buying new machines in bulk, getting the lower priced OEM software and then reselling it at a profit.
Even if you do manage to sell the unused Windows XP software, if it was installed on your computer before you brought it home, anyone who buys it from you might have a problem using it. My daughter’s computer never had Word or any other word processing program, and when I attempted to install the copy of MS Office 2003 that came installed on my Dell computer, it locked most functions until ‘activation’. When I attempted to activate it, I was informed that it was a single license and had been previously activated at the factory install of my computer.
I know that it is not relevant to US users, but this depends on local law. Here it is legal and Microsoft was very pissed-off when they lost a spectacular lawsuit to that effect.
On their German site Microsoft lists conditions for a legal resale of their software and they mention that “In Microsoft’s opinion” versions bundled to hardware have to remain bundled.
Cite (I chose this particular link because it is in English, not because it is particularly good. Especially the part on the possiblity of legal “used” resales is highly conjectural)
It is as said, to try to legally tie the software to a single machine, and prevent its resale. I know for a long time the legit places like Egghead and Newegg made you buy a bootable drive, but even a floppy qualified. And the last time I ordered an OS disk (a few years back now) they had relaxed the standards to include most any piec of hardware–for Newegg I think they made you buy a mouse, and they had opticals for $5 and balls for $2. I never heard of anyplace giving away junk hardware to qualify.
And I know at one point MS was trying to scare schools into buying new MS OS’s because they issued a press release that said that if a school used donated computers, that they had to have the original Windows licensed software also installed or the schools had to buy new licenses to replace them, even if they were running some alternate operating system! Everybody laughed and went back to work after hearing that one however.
Yes, MS tightened the screws with WinXP. Some disks now aren’t even “install” disks, they are just a HD image and a little stub DOS program that formats the entire drive and then copies the OEM-configuration image over. And yet other computers don’t come with any sort of reinstall disk at all; if you need or want to reformat, you are supposed to take it to a service center and have them do it there. I know that Gateway was one company doing this with their laptops for at least a while, because a guy I work with bought one.
And it’s particularly amusing now, because … -Gateway is closing their retail stores: http://slashdot.org/article.pl?sid=04/04/01/2255212&mode=thread&tid=137
-So all those people who need tech help may end up having to get it through snail mail.
~
Actually product activation it entirely different than OEM software. All software requires activation and it is true for most pieces of software you can’t have more than one active copy per copy of the software. Office is sometimes a caveat to that but Office OEM version is a single use only product (meaning single live activation at a time).
Actually, again the rules for what they should and should not apply were linmked above. that is the most current version of the OEM/System builder software policy.
Actually this may have stemmed from another issue entirely. One of volume licenses vs single use OEM or retail licenses. The fact is, if someone wants to use a licensed copy of windows they can get it in a few ways:
OEM - meaning it’s attached to the PC and that license belongs only to that PC
Retail - a standard full price copy, an dcan be installed per the rules in the End User Licen Agreement
Volume License (this covers standard volume licenses and academic lice3nses which is most likely what a school would have). - now it is possible in the circumstance you are stating above that the rundow was, the PC’s had windows on them. There was no valid license agreement to prove where they got the software, and the software wasn’t part of the volume license. Now if a school has a select volume license MS has the right to audit at least once to ensure the licensing terms are being met. To be safe, the school may have asked what to do. Of course the party line is, if you don’t know if you’re licensed you should purchase licenses.
I know that seems a little odd and i only gave you the highest level description of licensing. However if you want we can discuss this in detail in another thread.
Actually MS provides the software Image to the OEM manufacuter, it’s the manufacturer that decided how they want to provide it. It’s entirely up to the OEM how they provide the software in in what form once they buy it from MS> They have certain rules about what they can and cannot do. But in many cases these rules are very vague.