Upgrading from any Windows 8 preview
The fact that you used the Consumer Preview or Release Preview versions of Windows 8 doesn't grant you any license rights. Your eligibility for the upgrade is determined by the operating system you were previously using. Assuming that you installed the Windows 8 preview on a PC that was purchased with Windows originally, you're free and clear. Use the Windows 8 Upgrade Assistant to identify any issues you need to address, and then proceed with setup. As with Windows 7, you can do a clean install, moving your data and program files to a Windows.old folder, or you can migrate files, desktop programs, and settings to the final release.
Setting up Windows 8 on a new PC, new virtual machine, or dual-boot partition
If you're installing Windows 8 Pro on a PC that isn't already licensed for Windows, you don't qualify for a discounted upgrade. The same is true if you intend to keep your existing version of Windows and run Windows 8 in a separate partition in a dual-boot or multi-boot configuration.
Under the terms of Microsoft's license agreement, you can't use an upgrade version of Windows 8 for this type of installation. Instead, you need to buy the Windows 8 or Windows 8 Pro System Builder package from a reseller. Currently, those packages are priced at around $100 for Windows 8 (Core) or $140 for Windows 8 Pro. Unlike with earlier versions, the Windows 8 System Builder packages contain a Personal Use License (PUL) that allows you to install the software in a PC or virtual machine without the requirement to resell the system to a third party.
The license grants you "the right to install and run [Windows 8] as the operating system on a computer that you build for your personal use, or as an additional operating system running on a local virtual machine or a separate partition."
As I noted this past summer, this is the first time Microsoft has formally acknowledged the right of its end-user customers to install Windows 8 on a new PC they build themselves, or to install it in a virtual machine or on a separate partition. The older full packaged product is no more. You can read more about the PUL in this post: Microsoft radically overhauls license agreements for Windows 8.
Moving from Windows 8 to Windows 8 Pro
If you buy a new PC with the Core version of Windows 8 installed on it, you aren't eligible for the discounted $40 upgrade to Windows 8 Pro. Instead, you need to purchase the Windows 8 Pro Pack from Microsoft. The good news is that upgrade takes only a few minutes. You don't need any installation media; all that's required is a product key. And it doesn't require migrating files, settings, or programs, all of which remain untouched. The bad news is it costs more. Currently, the discounted upgrade price direct from Microsoft is around $70.
To begin the upgrade, open the System Properties dialog box and click Get more features with a new edition of Windows.
That leads to these two options:
If you choose the first option, you're taken to a screen where you can pay $69.99 for a Windows 8 Pro product key and upgrade on the spot.
Choose the second option if you already have a Windows 8 Pro product key. Note that this key can be from any edition of Windows 8 Pro, including System Builder and retail upgrades. You can successfully upgrade using a product key you purchased for $40 using the Windows Upgrade Assistant. It's up to you to decide whether you meet the requirements to qualify for an upgrade license.
Downgrading to Windows 7
I've said it before, but it bears repeating here: The only way to qualify for downgrade rights to Windows 7 is to purchase a new PC with Windows 8 Pro already installed by the PC manufacturer. If you buy a PC with Windows 8 (Core) and upgrade it to Windows 8 Pro, you do not qualify for downgrade rights. In that scenario, you must purchase a full retail license for Windows 7.
The Personal Use License rights are for Windows 8 only. Microsoft does not include this right with a System Builder copy of Windows 7:
Q.Can I use the Personal Use License for Windows 7 software?
A. No. The Personal Use License is for Windows 8 and Windows 8 Pro software only. If you are building a PC for your personal use with Windows 7 software, you still need to purchase the full packaged retail version.
If you do qualify for downgrade rights, you must acquire Windows 7 installation media on your own and activate over the phone.
In the final installment: Everything you need to know about Windows 8 product keys and activation.