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Licensing guide

Retail vs OEM vs Volume Licenses: Which Microsoft License to Buy

Updated by the Software Recycling support team

Retail licenses can be moved to a new computer, OEM licenses are tied to the first device they activate on, and volume licenses are bought by organizations under an agreement and activated with MAK or KMS. Most home users and small businesses need a retail style license for each PC or a properly licensed server.

Microsoft sells the same software through three main license types. Retail licenses can be transferred to another computer, OEM licenses stay with the first device, and volume licenses are sold to organizations under an agreement. The software you install is the same. What changes is where you can use it, how it activates, and what happens when you replace hardware.

Retail vs OEM vs volume at a glance

Retail is the flexible option, OEM is the device-bound option, and volume is the organization option.

Retail OEM Volume
Who buys it Individuals and businesses Bundled with a new PC or server Organizations under an agreement
Move to a new device Yes, one device at a time No, tied to the first device Depends on the agreement
Activation Product key, online or phone Often embedded in firmware or preinstalled MAK or KMS
Support from Microsoft The device maker Per agreement
Typical products Windows Home and Pro, Office Home & Business Windows on new PCs, servers from hardware vendors Office LTSC Professional Plus, Windows Enterprise

What is a retail license?

A retail license is bought on its own, not with hardware, and can be moved to a new computer as long as it is only in use on one device at a time. It is sometimes called a full packaged product (FPP) license.

You enter a 25-character product key during setup or afterward, and the software activates online. If online activation is not possible, telephone activation is available. When you retire a computer, you can uninstall the software and activate it on the replacement.

Retail suits home users and small businesses who keep a license for years and replace hardware during that time.

What is an OEM license?

An OEM license comes with a new computer and is tied to that computer. OEM stands for original equipment manufacturer, the company that built the PC or server.

Most modern PCs have the Windows key embedded in the firmware, so Windows activates automatically after a reinstall on the same machine. The catch is that the license does not transfer. If the computer fails or you replace it, the license stays behind. Support for OEM software comes from the device maker rather than from Microsoft.

OEM licensing also exists for Windows Server, where a server bought from a hardware vendor may include an OEM edition that cannot be moved to other hardware.

What is a volume license?

Volume licenses are sold to organizations that need many copies, under an agreement with Microsoft. They usually use one of two activation methods:

  1. MAK (Multiple Activation Key). One key activates many computers. Each activation is checked with Microsoft once, online or by phone, and counts against an allowed total.
  2. KMS (Key Management Service). A KMS host on the organization's network activates computers locally. Clients must contact the KMS host regularly to stay activated, so KMS is designed for machines that stay connected to the organization's network.

Some products exist mainly in volume form. Office LTSC Professional Plus is the volume edition of Office, and Windows Enterprise is a volume edition of Windows. Windows desktop volume licenses are upgrade licenses, which means the PC needs a qualifying Windows license first.

How activation differs by license type

Retail and OEM licenses activate with a product key that belongs to one device at a time, while volume licenses activate through MAK or KMS.

For retail keys, activation works like this:

  1. Install the software from Microsoft's official media.
  2. Enter the product key when prompted, or later in the activation settings.
  3. Activate online. If that fails, use telephone activation and enter the confirmation ID.

Our guides cover the steps for installing and activating Office, activating Office by phone and changing an Office product key.

Can I move a license to a new computer?

Retail licenses can be moved; OEM licenses cannot. Before moving a retail license, uninstall the software or remove the key from the old computer so it is only in use once. Then install on the new computer and activate. If online activation reports that the key is in use, telephone activation usually resolves it.

Hardware changes on the same PC are a gray area for OEM licenses. Replacing a hard drive or memory is normally fine. Replacing the motherboard is generally treated as a new computer.

Which license type do you need?

Pick the license type based on how many devices you have and how long you plan to keep them.

  1. Home user with one or two PCs. A retail style license for Windows and Office. If you are moving from Home to Pro, see upgrading Windows Home to Pro.
  2. Small business with up to a few dozen PCs. Individual licenses for each PC work well. Choose an Office edition that allows commercial use, such as Home & Business or Professional Plus.
  3. Organization deploying to many identical machines. Volume licensing with MAK or KMS gives central control.
  4. Servers. Windows Server is licensed by physical core, plus Client Access Licenses for users or devices. See Windows Server core licensing explained and RDS CAL user vs device.

How to check which license type you have

Windows and Office both report their license channel from the command line.

  1. Open Command Prompt as administrator.
  2. Run slmgr /dli. The description shows RETAIL, OEM_DM or a VOLUME channel.
  3. For Office, change to the Office folder (for example C:\Program Files\Microsoft Office\Office16) and run cscript ospp.vbs /dstatus.

Every key we sell is a genuine Microsoft product key recycled from a business that upgraded or closed down. If you are unsure whether a product suits your setup, ask before you buy. For background on resale, read is buying used software licenses legal.

Need help?

If activation fails or you are not sure which license fits your situation, open a ticket at /support or call +1-888-470-5516. Free tech support is available 7 days a week, and if a key fails to activate we send a working replacement free of charge.

Frequently asked questions

Generally no. An OEM license is tied to the device it was first activated on, usually the PC it came with. If you replace the computer, or in many cases the motherboard, you need a new license. Retail licenses are the type designed to move with you.
Both are volume activation methods. A Multiple Activation Key (MAK) activates each computer once with Microsoft, online or by phone, and counts against a set number of activations. KMS uses a server on your own network that computers check in with regularly to stay activated.
Open Command Prompt and run slmgr /dli. The description line shows the channel, such as RETAIL, OEM_DM or VOLUME_MAK. For Office, run cscript ospp.vbs /dstatus from the Office installation folder and read the license name.
The software is the same. The difference is the license terms. Retail can be moved to another computer when you replace your PC, while OEM stays with the original device. If you expect to replace hardware during the life of the license, retail is usually the safer choice.
Not necessarily. Volume licensing suits organizations that deploy many identical installs and want central activation. A small business with a handful of PCs can use individual licenses per computer, plus correctly sized server and CAL licenses for any servers.

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