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Yukon's description of the difference between OEM and retail is accurate for hardware in general but not for MS software. The main difference bewtween OEM and retail for MS operating systems is the license terms. An OEM MS operating system is tied to a specific motherboard/cpu and cannot be legally installed on any other motherboard/cpu. When you activate the OS for the first time, it will be forever tied to that motherboard/cpu. For retail, you can change the motherboard/cpu and get another activation code as long as you have removed the OS from the original system.
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