What’s the Difference Between OEM, Retail, and Discount Software?

If your organization is in need of software, there are several ways through which you can legally obtain it, depending on your organization’s needs and the amount of money that you are willing to spend. The three most common types of software purchases are OEM, retail, and discount software. The difference between the three is described below.


The Original Equipment Manufacturer (abbreviated as OEM) version is one in which the manufacturer or distributor provides custom software for their own products. Hardware manufacturers such as those making laptops, tablets, desktop computers, smart phones, or camcorders will often provide OEM software for free. Note that OEM software may be customized based on the pre-existing features of the gadget (laptop, PC etc). Sometimes this software comes preinstalled on your devices, but often times you can get it on a CD.


This is basically the ‘Box’ version of the software which can be bought from any retail store. Unlike an OEM version, the retail version of a software does not include any special third party licenses. Instead it includes the installation CD/ DVD, a printed user’s guide, and any other accessories that may be needed. Retail software is generally the most expensive of the three options, but it can also be the easiest to find.


Non-profit organizations are often eligible for discounted versions of software. All that that they need to benefit from this is proof of the 501(c)(3) status. In other words, discounted software (as the name suggests) is any software or application that is available to an organization at a reduced price. Many software companies have direct discount programs for certain types of organizations, but don’t overlook third party vendors such as Royal Discount either. Depending on your organization’s needs, there may be a discount program perfect for you.

Other Advice

It’s important to take the time to check out any software to ensure that it suits your needs. There is no point in getting a software program just because it’s available on a discount if you aren’t actually going to use it. Figure out what you hope to get from the software before you go shopping around.

Also, you should ensure that the software program you install (whether it’s OEM or retail or Discounted) works on your hardware before committing to a major purchase. Your technical team should be able to figure that out for you.

You should now understand the differences between OEM, retail, and discount software. Although all three have advantages and disadvantages, you’ll generally get a much better price from OEM and discount software than you will by shopping at a retail store.