How to Buy Windows Vista for Half Price

A Microsoft representative has confirmed that users may buy an OEM (original equipment manufacturer) copy of Windows Vista at a substantial discount, provided they adhere to the terms of the license — which, incidentally, may mean providing support for family members.

In addition, users should still be subject to the same familiar re-activation restrictions as users of a retail Vista license and Windows XP, a spokeswoman said.

Users can alter the PC's hardware substantially, but they will be forced to reactivate — not repurchase — the OEM software if they do, she said.

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One system builder pointed out, however, that Microsoft's OEM license forbids the software from being transferred to a whole new machine from scratch once it is installed on the original target machine.

OEM copies of Vista began showing up this week at e-tailers like Newegg.com for substantial discounts, which can run up to half off the price of a standalone retail copy of Microsoft's Windows Vista operating system.

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Microsoft is also offering its own in-house discounts, in the form of a Vista Family Pack, which allows the purchase of up to two copies of Vista Home Premium for $49.99 — provided that a customer buy Windows Vista Ultimate at full price through retail.

For those who don't need a full manual, however, the Windows Vista OEM versions offer substantial savings.

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Normally, such versions are restricted to "System Builders" — not large corporations purchasing thousands or even hundreds of copies of the operating systems through Microsoft's volume licensing programs, but small mom-and-pop computer shops building individual systems for local communities.

The license is agreed to when the shrinkwrap the package is sealed into is broken.

"System Builder software is designed for OEM system builders, and specifically for pre-installation on new PCs," said Elissa Brown, a Microsoft spokeswoman, via an e-mail. "So, this software isn't really intended to be installed by end-users. OEM versions of Windows Vista that are delivered through the System Builder channel are licensed via a 'break-the-seal' model (in other words, the System Builder License on the outside of the software package is agreed-upon when the package is opened)."

Although retailers like Newegg have typically been prohibited from providing the software without accompanying hardware, Brown said this wasn't true.

Readers of PC Magazine and dl.tv report that Newegg has continued its practice of bundling a token hardware component — drive cables, case screws or other knickknacks — as a way to offload any legal obligation.

"As long as Newegg is distributing the System Builder version of Windows Vista in an unopened package with the System Builder License adhered to the outside of the package, Newegg is not responsible for offering end user support," Brown said. "The party who opens the package (thus accepting the System Builder License) is required to offer end user support."

More specifically, "the system builder must place its support phone number in a noticeable location in the fully assembled computer system help files or end-user documentation," according to the terms of a publicly posted System Builder license posted to Microsoft's Web site.

That version of the license does not specifically mention Windows Vista, however.

The OEM version of the Vista versions lacks a manual, but includes a "Quick Start" installation guide, Brown said.

The Vista OEM versions will allow a user either to do a fresh installation, or to upgrade their previous Windows XP installation, she said.

As for activation, Brown said users could expect a return to the familiar activation scenario. Windows Vista, like XP, contains an electronic list of the components within the PC, which it turns into a code, or hash.

If a user adds or subtracts too many components, the hash will change enough that it will signal the need for another activation, which can be done either online or via telephone.

Vista, however, will apparently be a bit more tolerant of the DIY community.

"Windows Vista is more intelligent and a bit more lenient than Windows XP around hardware tolerance," Brown said.

She referred questions to Microsoft's Windows Activation Web page, which does not address Windows Vista.

In Windows XP, the software looked at ten hardware attributes to create the hash: the display adapter, the SCSI adapter, the IDE adapter, the network adapter and its MAC address, a "RAM amount range" (0-64 Mbytes, 64-128 Mbytes, etc.), the processor type, the processor serial number, the hard drive device, the hard drive volume serial number and the CD-ROM/CD-RW/DVD-ROM.

"Specifically, product activation determines tolerance through a voting mechanism," the XP Activation FAQ says. "There are 10 hardware characteristics used in creating the hardware hash. Each characteristic is worth one vote, except the network card which is worth three votes. When thinking of tolerance, it's easiest to think about what has not changed instead of what has changed. When the current hardware hash is compared to the original hardware hash, there must be 7 or more matching points for the two hardware hashes to be considered in tolerance."

One reader, who identified himself as a system builder in an e-mail, said he felt that receiving an activation code was not the same as adhering to the terms of the OEM license.

"Even though you can phone an activation rep overseas to activate the software, you're violating the EULA [end-user license agreement] and committing piracy," said the builder, who posted a similar note in the discussion forums attached to this story.

"It's important that people understand the OEM EULA when it says that your OEM Vista (XP is the same) can not be transferred to a new computer, and a new (upgraded) motherboard is also considered a new computer," the system builder added.

"I've activated hundreds of PCs over the years and have never had an activation rep ask if I am transferring the OEM software to a new PC. The only question that you must answer correctly (no) in order to receive the activation code is: "Is this version of Windows on more than one PC?". Therefore the end user assumes that since they received an activation code, they must be legal."

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