Dear Del: Lolly, Lolly, Lolly, get your license here

Dear Del,


I heard our IT director mention OEM licensing the other day. What is that? I want to sound knowledgeable the next time the subject comes up.

Good question. OEM refers to Original Equipment Manufacturer licenses, which are pre-loaded on the hardware and cannot be transferred, except in the case of a warranty replacement of said equipment. Windows Operating System licenses are sold OEM and since a laptop or desktop cannot be purchased without the operating system, the license is replaced with each piece of new hardware. (This does not apply to server operating systems.)

Dear Del,

I’m new to my organization’s software licensing program and am trying to determine what an Open license is and how it compares to a Volume license. Can you help?

I absolutely can help! Let me first define an Open license. Most publishers offer a license key that can be reused an infinite number of times for an individual user – this is an Open license. It generally applies when a user upgrades her laptop and is allowed to reuse her existing software license on the new machine. Whereas an Open license is reusable, an OEM license cannot transfer from one piece of hardware to another. An Open license cannot be transferred from one user to another – say, when an employee is replaced; rather, the license can be reissued to the replacement employee.

There are some special rules that govern Open licenses; for example, each individual user may have rights to install the software on up to 2 machines, such as when an executive has both a laptop and desktop, but needs only 1 license to cover both machines.

Open licenses usually have a minimum purchase requirement; for example, Microsoft requires an initial purchase of 5 licenses (of any program, mix and match).

A Volume license is often confused with what is known as a Site license (a license purchased with unlimited number of users within an organization); a Volume license is actually a bulk purchase of Open licenses. Microsoft does not offer volume discounts for fewer than 500 licenses.

DelCor recommends Open licenses for their transferability. OEM licenses cost a little less, but are disposable.