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OEM vs Retail vs Bound Licences: Which Software Licence Type Should You Buy?
Buying a Windows or Office licence but confused by terms like OEM, Retail, and Bound? You are not alone. These three licence types determine how you can install, transfer, and reactivate your software — and choosing the wrong one can cost you money.
Here is the short version: OEM licences are locked to one computer and cannot be transferred. Retail licences can be moved between devices. Bound licences are tied to your Microsoft account for the easiest setup. Below, we break down each type so you can pick the right one for your needs — and save up to 90% vs retail prices.
What Are Software Licence Types?
When you buy software like Windows 11 Pro or Microsoft Office 2024, you are not just buying the software itself — you are buying a licence that grants you the right to use it. The licence type determines:
- How many times you can activate the software
- Whether you can transfer it to a new computer
- How installation works (product key vs Microsoft account)
- What happens if your computer breaks or you upgrade hardware
Understanding these differences before you buy can save you frustration — and money. All three types are 100% legal in the EU under the UsedSoft ruling (C-128/11), which confirmed the right to resell software licences within the European Union.
OEM Licences Explained
OEM stands for Original Equipment Manufacturer. These licences were originally designed for computer manufacturers like Dell, HP, or Lenovo to pre-install Windows on new PCs.
How OEM Licences Work
- Tied to the hardware: An OEM licence binds to the motherboard of the computer it is first activated on
- One activation: You get a single activation. If you change your motherboard, the licence becomes invalid
- Non-transferable: You cannot legally move an OEM licence to a different computer
- Perpetual: The licence never expires — it lasts as long as the computer does
- No version upgrades: OEM licences typically do not include major version upgrades
Who Should Buy OEM?
OEM licences are ideal if you are setting up a PC that you plan to keep for years without major hardware changes. They are the most affordable option — for example, Windows 11 Pro OEM starts at just €20.65 at Licendi, compared to €259 at Microsoft.
Best for: Budget-conscious buyers, business PC deployments, computers you will not upgrade significantly.
Retail Licences Explained
Retail licences (also called FPP — Full Packaged Product) are the licences Microsoft sells directly to consumers in stores or on microsoft.com. At Licendi, we offer digital delivery of retail licences at significantly lower prices.
How Retail Licences Work
- Transferable: You can deactivate the licence on one computer and reactivate it on another
- Multiple activations: As long as the licence is only active on one device at a time, you can transfer it
- Not tied to hardware: Surviving a motherboard change or full PC replacement is possible
- Perpetual: No expiration date
- Product key based: You activate using a 25-character product key
Who Should Buy Retail?
Retail licences are perfect if you upgrade your PC frequently or want the flexibility to transfer your licence. They cost more than OEM, but the transferability makes them better long-term value.
Best for: Enthusiasts who build/upgrade PCs, users who switch computers every few years, anyone who wants maximum flexibility.
Bound Licences (Microsoft Account-Linked)
Bound licences are tied to your Microsoft account rather than to a product key or hardware. When you buy software directly from the Microsoft Store online, you typically receive a Bound licence.
How Bound Licences Work
- Linked to your Microsoft account: Sign in with your account to activate — no product key needed
- Easy transfer: Moving to a new PC is as simple as signing into your Microsoft account
- Perpetual and transferable: Lasts forever and follows your account
- Regular security updates: Full update support included
- Multi-device support: Some Bound licences (like Office) work on smartphones and tablets too
Who Should Buy Bound?
Bound licences offer the easiest installation experience. No keys to remember, no activation errors. Just sign in. They are ideal for less technical users or anyone who wants a hassle-free setup.
Best for: Non-technical users, people who want the simplest setup, users who frequently switch devices.
OEM vs Retail vs Bound: Side-by-Side Comparison
| Feature | OEM | Retail | Bound |
|---|---|---|---|
| Tied to | Motherboard / hardware | Product key (portable) | Microsoft account |
| Transferable? | No | Yes (one device at a time) | Yes (via account) |
| Activations | 1 | Multiple (sequential) | Multiple (via account) |
| Survives hardware change? | No (motherboard swap = lost) | Yes | Yes |
| Installation difficulty | Medium | Medium | Easy (just sign in) |
| Price at Licendi | From €20.65 (Win 11 Pro) | Higher than OEM | Highest |
| Best for | Fixed PCs, businesses | PC builders, upgraders | Non-technical users |
| Perpetual? | Yes | Yes | Yes |
Which Licence Type Should You Buy?
The right choice depends on your situation:
Choose OEM if:
- You are buying for a desktop PC that will not change much
- You want the lowest possible price
- You are deploying multiple business PCs and need cost efficiency
Choose Retail if:
- You build or upgrade PCs regularly
- You might switch to a new computer in 2-3 years
- You want the safety net of being able to transfer your licence
Choose Bound if:
- You prefer the easiest possible setup
- You want no product keys to manage
- You use multiple devices (PC, tablet, phone)
At Licendi, most customers choose OEM licences because of the significant price advantage — you can get Windows 11 Pro for just €20.65 compared to Microsoft's €259 retail price. That is a 92% saving. All our licences are genuine, EU-legal, and come with a lifetime warranty and instant digital delivery.
➤ Browse all Windows licences at Licendi
Are OEM and Retail Licences Legal in the EU?
Yes, absolutely. The European Court of Justice ruling in UsedSoft GmbH v Oracle (C-128/11) confirmed that reselling software licences is legal within the EU. This applies to OEM, Retail, and Bound licences equally.
When you buy from Licendi, you receive a genuine licence backed by:
- EU legal compliance — fully protected under European law
- Microsoft Partner status — we are an authorised Microsoft reseller
- Trustpilot 4.8★ rating with 220+ verified reviews
- Lifetime warranty — if anything goes wrong, we replace your licence
- Personal support — chat, email, phone, and WhatsApp
➤ Read more: Are Second-Hand Software Licences Legal?
Frequently Asked Questions
Can I upgrade from OEM to Retail?
You cannot convert an OEM licence to Retail. However, you can purchase a new Retail licence and use it on the same computer. The new Retail key will override the OEM activation, giving you transferability going forward.
What happens to my OEM licence if my motherboard breaks?
If you replace your motherboard, the OEM licence is lost because it was bound to the original hardware. You would need to purchase a new licence. This is why Retail or Bound licences are better choices if hardware failure is a concern.
Which licence type is cheapest?
OEM licences are the most affordable option. At Licendi, Windows 11 Pro OEM starts at €20.65 — up to 92% less than Microsoft's retail price of €259. All licences include lifetime warranty and instant delivery.
Are OEM licences from Licendi genuine?
Yes. Licendi is a Microsoft Partner and all our licences are 100% genuine and EU-legal under the UsedSoft ruling. We have a 4.8★ Trustpilot rating with 220+ reviews and offer a lifetime warranty on every licence.
Can I use a Bound licence on multiple devices?
For Windows, a Bound licence can only be active on one device at a time, but you can transfer it by signing into your Microsoft account on a new device. For Office Bound licences, some versions support installation on multiple devices (PC, tablet, smartphone) simultaneously.
Ready to Buy? Save Up to 92% at Licendi
Whether you choose OEM, Retail, or Bound, Licendi offers genuine EU-legal licences at a fraction of the retail price. Here are our most popular products:
- Windows 11 Pro — from €20.65 (retail: €259)
- Windows 11 Home — from €17.35
- Windows 10 Pro — from €14.86
- Office 2024 Professional Plus — from €62.99 (retail: €439)
Every licence comes with instant digital delivery, lifetime warranty, and personal support via chat, email, phone, or WhatsApp.
