A few days ago my “partner in crime” Ed asked me to check a thread on a tech forum (which particular site is neither important, nor germane to this dicussion). In that thread, some members were discussing the idea that Microsoft was seemingly granting Windows 10 licenses for free. That is, they asserted that a clean installed W10 on a new virtual or physical machine with no existing digital license was getting activated without the user having to enter a product key.
Of course, I am in no position to say that those Windows users are wrong. In IT and computing in general, we all know that almost anything is possible. I’ve seen my share of unexplained things happen in many operating systems. It could have been that, for a few days, Microsoft’s activation servers experienced a glitch that caused activations to be issued without an underlying digital license or a valid product key. However, I suspect that this assertion from those forum members arose from a misunderstanding about how Windows 10 digital licenses and activation policies actually work.
Let me explain.
Let’s start with some unassailable facts: When a specific Windows 10 edition is activated for the first time on some device, that device will obtain a digital license for that edition. Thereafter, every additional clean install of that same edition will be activated automatically. This digital license is based on a so-called hardware signature, a hardware ID (HWID). The HWID is a hash value based on current hardware components and the BIOS / UEFI present on the device for which that value is calculated. If you’re interested, you can read more about HWID in this support article “Specifying Hardware IDs for a Computer” (Microsoft Docs).
Although I’m not completely sure about this, my belief is that for the Windows 10 digital license the HWID used is known as HWID 3. (See the afore-mentioned support article, and scroll down to the table heading that reads “HWID Windows 10”). As you can see when reading that list of HWIDs, hard disk information (or VHD/VHDX info for a VM) is not included in calculating the hash value. All this means is that for an activated Windows 10 installed on an HDD which dies that you replace with a new SSD, a clean install of the same edition of Windows 10 on that new SSD will be automatically activated. It uses the already-existing digital license, The key is asked when you clean install, but if you have a digital license for that edition on that machine, you can (and should) select “I don’t have a product key” without entering any product key. Windows will be activated based on HWID.
For an activated Windows 10 VM, you can simply discard and bin existing VHDs and instruct the VM to use a new VHD. That is, you can start from scratch by creating a new VHD, attach it to the VM, and clean install Windows 10 on that VM. If you do this, that VM will be activated automatically.
Furthermore, a single device can have multiple digital licenses, one for each edition of Windows that’s been installed on that device. Thus, for example, let’s say you create a triple-boot system, with Home, Pro and Education editions installed side by side and activated. Then, you replace the HDD or SSD and clean install any of these three editions. In this situation, any or all of those three editions — which have already had the HWID calculated and stored for the device during the activation process — will be activated automatically based on the digital license for each edition registered for that device.
Now for some outright fiction: on various tech sites and forums I have occasionally read about users observing that when they set up a VM on their activated host, that VM was automatically activated. Sorry geeks, but this is simply untrue and will never happen. The same fallacy arises when another user relates that he / she had Home edition installed, then wiped the HDD installing Pro which was somehow automagically activated. Once again, I’m sorry to say that this is not really what happened. The only way this could occur is that said device at some earlier point had Pro installed and activated. In such a case, automatic activation would indeed occur. But that activation would be based on an existing — and valid — Windows 10 Pro edition digital license registered on Microsoft’s activation servers.
Let’s get back to hard, cold facts. When a device obtains a digital license for a specific Windows 10 edition, you can install that same edition for dual boot. It, too will be automatically activated because the HWID remains the same. I use this option on my W10 PRO x64 EN-GB laptop by multi booting to Finnish and Swedish W10 PRO x64 native boot VHDs. Whatever language version of W10 PRO I select from the Boot Menu, they are all activated because their HWID is the same. That’s because they all run on the same laptop, which has a digital license for the Pro edition that boots. A digital license is edition specific, but is valid for all languages and for both 32- and 64-bit versions of that edition.
A Windows 10 digital license does not require a Microsoft account. If the user elects to sign in with a local, domain or Azure AD account, the digital license for that device is valid and remembered by the activation servers, purely based on its HWID. Linking a digital license to a Microsoft account does confer an additional benefit — namely, that the license information will be stored and can be seen at https:account.microsoft.com/devices, where a list of your licensed Windows 10 devices is stored for that account, like this:
In fact, this is what makes license transfer to a new device possible. Only retail licenses can be transferred, although some users have reported they have successfully transferred OEM licenses. I would like to think of this occasional success, as more of an exception than a rule.
It’s simple, really. As long as you do not change the motherboard or CPU, you will have a digital license for every edition you have ever activated on that device. HDD / SSD / VHD is not in the equation and can be replaced without losing that license. There’s no magic or luck involved, and it doesn’t mean that Microsoft’s activation servers are letting anything slip past their control. Appearance or belief to the contrary aside, those activation servers are working exactly as they’re supposed to work. Nothing more, nothing less!
Author: Kari Finn
A Windows Insider MVP, Kari started in computing in the mid 80’s writing code for VAX / VMS systems. Since then, he’s worked in a variety of IT positions. He specializes in Windows image capture, customization, repair and deployment as well as Hyper-V virtualization. Kari is a proud Team Member at number #1 Windows site TenForums.com.