John,

The quick answer to the original question, regarding transferring the
license to another computer, is "it depends". If the software is OEM, then
what it depends on, largely, is who answers the phone at the activation
center. Some operators may, others may not. Strictly speaking, OEM is not
transferable to different hardware; end of story.

There are many parts to the Retail versus OEM equation, but the essence
boils down to several points. OEM (as noted) is not designed for end users
to install themselves. OEM is designed for companies who manufacture
computers. Granted, an end user may choose to be their own OEM, by
purchasing OEM software. When an OEM installs OEM software on a computer
which they manufacture, then they are obligated to support that computer;
Microsoft has no role in this. The OEM software license is tied, legally, to
the first computer which it is installed and activated on; the one which the
OEM has manufactured. If the computer becomes defective, unless the exact
same hardware is available for repair (in which case it is essentially still
the same computer), then the OEM software license expires along with the
defective hardware. This is to protect the OEM manufacturer, who cannot
possibly support hardware which they did not supply. It is for this reason
(primarily), that OEM software cannot be transferred to another computer.

By contrast, Retail software, purchased by an end user, and installed by
them on their computer, has no OEM involved. Therefore, the license is
directly between the end user and Microsoft, unlike OEM software, where the
license is between the end user and the OEM. Since the Retail license is
between the end user and Microsoft, support is provided directly by
Microsoft. Since the software is fully licensed directly to the end user
(without a hardware component), it can be moved freely between computers. It
may require a call to the activation center, but since it is Retail
software, the end user is fully able to move it as desired.

Therefore, several things need to be considered. There is nothing to prevent
an end user from becoming their own OEM; but... they need to fully
understand what they are becoming involved with. If an end user wants to
save money by purchasing OEM software, and not Retail, then they need to be
willing to accept the fact that they will be quite limited as to what
changes can be made. They cannot legally move it to a different computer;
they will be limited in how many hardware upgrades can be performed before
it becomes a "new" computer, hence no longer qualifies, they must provide
themselves support.

If an end user wants to be able to move the software at will between
computers, or perform extensive hardware upgrades, then they really should
purchase Retail. Yes, it is more money, but Retail allows all of those
changes, as often as desired, and provides support directly from Microsoft.
Unless someone knows precisely what the rules and processes are, then OEM
can be a dead end. On the other hand, if someone is totally familiar with
the process, then OEM can work fine. OEM software can have a limited life
span (the life of the original hardware), Retail software exists in
perpetuity.

Perhaps one of the biggest traps waiting to ensnare someone, could be
activating prematurely. A freshly installed version of Windows can typically
be fully used for up to 30 days prior to having to activate (assuming
automatic activation was not selected). If the end user finds within that 30
day window, that Windows does not work properly, or otherwise meet their
expectations, they can easily move the software to a different computer,
again and again, until they find the computer and configuration which meets
their expectations. Once OEM Windows is activated though, it becomes
permanently tied to that hardware.

With some careful foresight, planning and practice; the Retail versus OEM
Windows experience does not have to be a bad one.

John Baker