Buyer beware! Counterfeit software rampant in refurbished equipment market

Using refurbished computer equipment–printers, servers and mostly desktop and laptop PCs–is an attractive option for cost-conscious organizations like small- to mid-size firms, school boards and individual schools, for example.

Unfortunately, however, the refurbished equipment market has also been a hotbed of software piracy–primarily the illegal use of improperly licensed operating system software. According to Microsoft, counterfeit software is a serious and growing problem for the 35 million PCs that are refurbished and resold globally each year.

Refurbished equipment goes through a number of steps that leave it ready for use by a new owner, including wiping of all data and previously installed software, repair and/or replacement of defective hardware components, and installation of a new operating system.

“A refurbisher needs to follow the existing protocols for re-installing software on a refurbished PC,” says Robert Santin, Director, OEM Business Development & Strategy at Microsoft Canada. “Refurbishers need the original Recovery Media (i.e., re-installation disk) for the software and with the original Certificate of Authenticity (CoA) sticker, showing the unique product ID corresponding to the original software, still attached to the PC. Meeting these two requirements is the only way to properly transfer the ownership of a Microsoft license”.

What typically occurs is that enterprises buying significant numbers of new PCs don’t keep the recovery media, so when the time comes, they can resell the PCs but they are not entitled to sell or transfer the operating system licenses because they don’t have all the required components, as they are lacking the recovery media.

Some refurbishers and dealers reinstall the software anyway without meeting the licensing requirements. This means unsuspecting purchasers don’t get the benefits of being a legitimate licensee, including eligibility for software upgrades and access to professional technical support. It also hurts dealers who respect the publisher’s requirements for licensing, and who, having to compete with the low prices of pirates, not only lose software license revenue, but also system sales and the opportunity to service those clients for years to come.

“A used PC might be worth only $100 or less, but to also buy a new Windows OS license is considerably more than this, which in many cases negates the cost viability of refurbishment,” says Santin. He also says that the nearly one million PCs that enter the refurbishment channel in Canada annually are largely without the necessary components to allow software re-installation. This was leaving professional refurbishers with no cost-effective way to get an OS installed on these machines–until Microsoft launched its new MAR (Microsoft Authorized Refurbisherprogram.

The program allows responsible refurbishers to obtain Windows OS licenses from Microsoft at a reasonable price that allows them to attach a new, fully authorized license to a refurbished computer under conditions that protect the purchaser, the refurbisher and Microsoft. If you’re in the market for a used PC, it’s worth looking into this.


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