OEM software, or original equipment manufacturer software, is software sold by the creator to another company for resale. For instance, Microsoft sells OEM copies of Windows Vista to computer manufacturers who install the software on new computers. Computer manufacturers (e.g., Dell, Sony, HP, etc) generally purchase OEM copies of Windows Vista in large quantities, so each OEM copy of Vista sells

You open it - you support it

When you break the seal on a OEM copy of Windows Vista, you agree to Microsoft's OEM system builder license attached to the software. A key requirement is for you to provide support to the person using the computer. Retail copies of Windows Vista come with 90 days of free support, and people who install OEM software have to provide support to the end-user. You must put your support telephone number on the system or in the device's documentatioon.

What does that mean? Legally, if you install on the software on your friend's computer, you have to provide the first level of technical support for your friend at no charge. If you install the software on your own computer, you must provide your own technical support. You can, however, pay for technical support from Microsoft.

Install only once - no transfers allowed

Another restriction of the OEM license is that after you install the software on one computer, you can't transfer it to another. If you want a copy of Vista you can install on one computer today and later use on a different computer, you must purchase a full-priced retail copy.

If you replace the motherboard in your computer, you also can't continue to use the OEM copy of Windows Vista on it. Microsoft considers a motherboard such a significant component that, when you replace it, you have created a new computer. The OEM copy of the software will then fail the validation, and you should purchase a new license to continue using Vista.

OEM Windows Vista - a good choice?

Whether an OEM copy of Windows Vista is a good choice for you depends on whether you can live with the conditions outlined above. For greatest support and flexibility, buy a retail copy. But if you don't need the pretty box, support, or flexibility to transfer the software to another device, consider OEM copies of Vista.

*** I have got an small hardware with the purchase. What is it for?