Microsoft has accused high-street retailer Comet of pirating 94,000 Windows Vista and Windows XP recovery CDs and selling them to consumers.

The software giant announced this morning that it had filed a suit against Comet Group PLC, accusing the group of manufacturing counterfeit discs at a factory in Hampshire and selling them through its UK retail outlets. Comet has 248 stores across the UK. A spokesperson for Microsoft was unable to say where the suit has been filed.

The allegedly counterfeit recovery discs were then sold to customers who had bought desktops and laptops running Windows, Microsoft said.

Microsoft's associate general counsel for worldwide anti-piracy and anti-counterfeiting David Finn called Comet's actions "unfair to customers" in this morning's statement.

"We expect better from retailers of Microsoft products - and our customers deserve better, too," he said.

This will be some kind of licencing cock-up. I sincerely doubt they're actually pirating OS discs.

I'd like to think so, but ..............

Microsoft OEM licensing wrote
Q. Can I create my own recovery disks and sell these with the computer systems that I build? I have heard that direct OEMs can do this, so why can't I?

A. No. System builders may not offer a recovery solution with removable media (e.g., a recovery CD) because it is prohibited by the terms of the Microsoft OEM System Builder License. A full version of the Windows operating system is provided on a hologram CD in the Microsoft System Builder pack for each end user, and the CD must be transferred to the end user at the time of distribution. The hologram CD acts as the recovery media.

However, system builders can offer a hard disk recovery solution in addition to, but not as a replacement for, the hologram CD. Third-party software companies can also help system builders do this. Learn more about the technical requirements for this type of hard disk-based recovery solution .pdf 1.8 MB.

System builders are bound by the Microsoft OEM System Builder License, affixed to the side of the System Builder packs, which is different than the direct agreements utilized by direct OEMs. The licensing terms for system builders and large OEMs are different because they are designed to address the specific needs of each community. The right to create recovery media is limited to the OEMs with direct agreements; however, these OEMs are also bound by other contractual obligations. The OEM System Builder License is designed to make it easy for system builders to acquire and distribute genuine Microsoft software, and accordingly, its terms are different.

Q. Are system builders allowed to create a "ghost image" CD and ship it along with the system for OEM customers?

A. No. System builders may not offer a recovery solution with removable media (a recovery CD, for example)—it is prohibited by the terms of the Microsoft OEM System Builder License. A full version of the Windows operating system is provided on a CD in the Microsoft System Builder Pack for each end user, and the CD must be transferred to the end user at the time of sale. The hologram CD acts as the system builder recovery media.

Please refer to the preceding question for more information.

If I'm reading that correctly, I should get a CD/DVD with Windows on it every time I buy a Windows PC. That hasn't happened for me since 2003, so either I'm reading it wrong or Microsoft really don't care.