Microsoft Licenses by Distribution - OEM (2/3)

The Original Equipment Manufacturer, or OEM, is a specific type of software distribution that is usually pre-installed on the device and shipped to the end customer along with the hardware. OEM licenses are most commonly found for Windows, Windows Server, or Office. The advantage of this solution is that the software is properly installed and will therefore work properly. One of the conditions of OEM licensing is that the CoA (Certificate of Authenticity) label is affixed to the hardware. The CoA itself proves that the software is genuine (and affixing it meets the manufacturer's requirements), but does not itself grant the right to use it.

Although OEM licenses are commonly available at traditional retailers, it is important to keep in mind that only System builders can work with OEM licenses. System builders are computer manufacturers who install software into hardware devices and sell them together to end users. By purchasing the product, the end customer acquires the right to use the software, while System Builders have the right to only distribute it.

The MAR (Microsoft Authorized Refurbisher) licensing program is intended for so-called refurbishers, ie companies that deal with hardware refurbishment - reinstallation, cleaning and sale of older hardware. This is a type of OEM program with a link to a specific refurbished device. Microsoft supports hardware recycling efforts by offering MAR licenses at a significantly lower price than regular retail licenses.

To obtain and sell these licenses, the refurbisher must meet the requirements to participate in the program, which include, for example, proof of technical competence, quality assurance, or approval by Microsoft. These companies then obtain special certificates of authenticity (so-called CoA), which are often personalized for a specific refurbisher and must be visibly placed on a refurbished device. As with other OEM distributions, the license is created by affixing a CoA label. After purchasing the hardware, you must activate the software using the product key found on the certificate. Neither the product key nor the CoA label in themselves grant the right to use the software, they only confirm that the software is genuine.

Embedded, as another type of OEM distribution, such type of software is built into a specialized device. It is used across sectors such as healthcare, industry, transport or retail. It differs from the classic OEM license by a cheaper price and, above all, by a dedicated usage for specific end devices, such as payment terminals, kiosks, ATMs or heart monitors.

IoT (short for Internet of Things) is a network of objects with built-in software for interconnection. It allows you to connect, communicate and transfer data over the Internet. It is a system of all devices in an organization or household, forming a complex infrastructure. Thanks to the Internet, specialized terminal devices such as cameras, air conditioners, security alarms, smoke detectors, washing machines or interactive whiteboards at school can be connected.

For OEM licenses, as with almost all licenses, transfer to another owner is possible. Of course, all the conditions laid down by legislation and case law must be met. The original holder must uninstall the licensed software and provide all original documents to the new holder, including proof of payment. Proof of purchase of an OEM license is an invoice or other proof of full payment towards authorized distributor, which must state that the purchased hardware includes a software license.

While it is possible to come across the claim on the Internet that OEM licenses are tied to hardware and their resale is not possible, this is not entirely true. The Microsoft License Terms state that the rights to use the software must be in accordance with applicable law. With respect to applicable legislation, trading with secondary OEM licenses is legal. On the other hand, it is necessary to draw attention to the fact that it is not possible to meet the necessary relevant conditions and offer documentation for traders with these "licenses", without which it is not possible to invoke the so-called exhaustion of law to control further distribution.