Should I buy the OEM version or the Retail version of software?

Oscar Sodani is a founder of Help2Go and owner of Help2Go Networks, an IT consulting firm in the Washington D.C. area. Oscar holds the CISSP certification as well as industry certifications from Microsoft, Cisco and Novell.

This is a question that often comes up in our Question and Answer forum. Is it legal to buy OEM software? What are the restrictions? Why is it so much cheaper than the retail version?

OEM stands for Original Equipment Manufacturer. OEM software is sold by the software creator to a hardware manufacturer. For example, Microsoft will sell OEM versions of Windows and Office to companies like Dell or Gateway, at volume discounts. Dell and Gateway are then able to sell you the PC, complete with software, at a reasonable price. If you bought a PC from one of these companies, chances are that in the box, you found a handful of CD-ROMs with all kinds of software on them. No manuals, no instructions - just the CDs. These CDs are OEM software.

Sometimes, people and/or companies will not use the OEM software that came with their computer, and so they decide to sell the software, usually very inexpensively. If you need the software, it's a great way to save tens or hundreds of dollars off of the retail, boxed version you would buy in the store.

There ARE restrictions, however. Some OEM software comes with a restrictive license that says it can only be used with the hardware it originally came with. So, if you got an OEM version of CD-burning software, the license may restrict you to using the software ONLY with the CD-burner that came with your PC. These licenses, while restrictive, are also unusual.

Most OEM licenses only require you to buy a piece of hardware with the OEM software - ANY piece of hardware. For instance, you can pick up an OEM version of Windows XP Professional at a high discount, as long as you buy a cheap mouse at the same time. It's a silly rule, but licenses are licenses.

Some OEM software have no restrictions, but those are few and far in-between. You should always find out the license restrictions with OEM software BEFORE you buy.

Other differences between OEM and retail software?

-You usually won't receive a box or a manual with OEM software. Just the CD-ROM.
-You usually won't be entitled to any kind of technical support from the manufacturer with OEM software. So you're on your own.
-Retail versions of software are MUCH more expensive than OEM versions.

eBay has a strict policy that OEM software can only be sold with some sort of hardware device. You can also buy OEM software from most major online computer retailers. Just search for OEM in the retail site's search box.

Personally, I recommend buying OEM software if you are proficient with computers and you won't need the manual or support. Most manuals and some tech support can be found online at the manufacturer's site, anyway.

Discuss this article here

Have a question? Need help? Get free, friendly person-to-person help with your computer questions or spyware questions in our help forums!