Over at The Seattle Times, you can read a long feature I wrote about installing Windows XP Service Pack 2 in three ways on an Intel iMac: with Boot Camp, via Parallels, and using Q. Most of this territory was covered in recent TidBITS articles with greater technical detail than I offered for a general newspaper audience (see "Apple Opens Boot Camp for Windows Users" and "WinOnMac Smackdown: Dual-Boot versus Virtualization" in TidBITS-825).
Some feedback from readers, however, makes it clear that Windows XP licensing terms are a matter of some confusion for those of us in the simpler world of "you buy a new copy with every Mac OS X release." True, Apple offers two consumer licenses: a 1-pack and a 5-user family pack. Other licensing programs are available, such as a 3-year software subscription I bought for an Xserve that provides full versions of every version of the operating system released during that 3-year period.
But Microsoft takes a different approach for Windows XP, and ostensibly for the forthcoming Windows Vista, too. Windows XP requires activation, a process that takes a snapshot of hardware on the computer, sends it to Microsoft to record along with your Windows XP serial number, and then allows Windows XP to continue to operate on that hardware. Activation must take place within 30 days of installation. If you substantially change your computer or move Windows XP to a new computer, you may encounter difficulties in activating a reinstalled copy.
There are full retail versions, which are shrinkwrapped and licensed for single computers. These are the most expensive copies to buy, costing nearly $200 for Windows XP Home and $300 for Pro. You can find slight discounts off retail prices if you hunt, dropping down $25 or so from the full price. I confirmed with Microsoft last week that a single-user license is not legal to install on both a Boot Camp partition and a virtual machine running on the same computer, even though those are not running at the same time.
There are also upgrade versions of Windows XP, costing $100 less than the full retail versions, but upgrade versions require an older version of Windows. You can install Windows XP over the earlier version, but I believe you can also create a new installation as long as you have the original media for the previous Windows version available to insert at the appropriate point to confirm your ownership. However, as Jeff Carlson pointed out to me, upgrading an old version of Windows entails installing both versions on a Mac, which, when you consider the time required to download service patches and security updates, could total many hours; he said he'd rather just pay the extra $100 for a recent full version of Windows XP and avoid all the hassle.
The so-called OEM (original equipment manufacturer) version of Windows XP is licensed and customized as a bundle with a computer. A few readers of my Seattle Times piece wrote in to note that you could purchase OEM versions that were "overstock" or "excess inventory" from several sites online often for a fraction of the full retail cost. Unfortunately, these OEM sales violate Microsoft's licensing agreement. There's no such thing as "excess inventory" of OEM copies because those copies are licensed to the computer makers on a per-computer basis. No computer, no license.
There's a lot of risk in purchasing these copies because the serial numbers are obviously in batches, and Microsoft can cancel (through its activation system) any outstanding serial numbers. They do this regularly for copies of Windows that circulate through online file-trading systems. There's also apparently a fair amount of dodginess among companies that offer OEM copies since, technically, they shouldn't be selling them. Microsoft designed several points of authenticity on Windows XP packaging and media, and if you're going to walk on the twilight side of this particular licensing avenue, you should know what a legitimate copy of XP looks like so you can confirm it's real when it arrives.
(One TidBITS regular noted to me via email after I posted this article on ExtraBITS that there are even cracked, back-door OEM versions for sale that have spyware/malware baked right in. Purchasing a so-called OEM copy from a shady firm could lead to an immediate compromise of the machine you installed it on. While this sounds a bit like 1950s advice about avoiding loose ladies, it's completely feasible as selling an OEM copy already puts a company over a certain legal line.)
Finally, many companies purchase volume licenses from Microsoft for flexibility in administration and installation. These volume licenses avoid some of the complexity of managing serial numbers among large numbers of users and reduce the cost considerably from full retail purchase price. Companies that have volume licenses will be able to use those licenses to install Windows XP on Boot Camp partitions or virtual machines.
Now, I don't want to be seen as defending the particular terms that govern these licenses. I don't hold a brief for the cost of Apple's or Microsoft's operating systems - I've long thought Apple greedy in not offering some form of upgrade license for Mac OS X - but I want to make sure that Mac owners understand the grief that can result from buying the wrong version of Windows XP.