PSA: Use Caution with Parallels Desktop 11 and Windows 10 Free Upgrade *UPDATED*


Per Parallels Support team, after you convert  your Boot Camp to a Parallels VM, wait up to 1 week and the activation issue will fix itself. I have not personally tried this yet, so I cannot promise truth behind this, plan to try at a later date.

*Original Story*

Before I start, let clarify that I am already in touch with Parallels support on Twitter and they are reviewing the case (thanks Parallels Support team!). In the meantime, I wanted to share my experience so others can use caution if they are in same boat as me.

Problem Statement

Deploying Parallels Desktop v11 in conjunction with existing Windows 10 (Pro in this case) that was free upgrade from Microsoft results in deactivation of Windows with no option to reactivate (dead license key).


  • Machine: MacBook Air, late 2013 model, with all bells and whistles (i7, 8gb ram, 13″ screen)
  • Mac OS: Current RELEASED version (not Public Beta), sorry, don’t know exact version, to be honest I am a Windows user.
  • Windows OS: Windows 10 Pro (latest RELEASED updates, no beta builds)
    • Licensing: Free Upgrade from MS from Windows 8.1
    • Installation: CLEAN install after activation of Windows 10 associated to my MS account

Windows 10 Upgrade Details

If you are not familiar (or have been living under a rock for past month), MS released Windows 10 Windows 10logowith a bonus offer of anyone with a valid (maybe pirated but that has been going back and forth for sometime) Windows 7, 8 or 8.1 license gets a free upgrade to equal version of Windows 10. When you receive this upgrade, you do not receive a license key per se, instead, they log your machine details into your associated MS account. This means anytime you rebuild your machine, you no longer need to track down your license key because as long as you have an internet connection, you will automatically be activated.

Reproduction steps

Install Parallels Desktop 11 on Mac OS X (current release version). After successful install, you create a new Virtual Machine. We are then presented with the next dialog –


Since I want to continue to have an option to use Windows in Boot Camp only for improved performance when needed, I selected the option Use Windows from Boot Camp. I am then presented with this dialog –


This dialog is VERY important, I cannot stress enough.  I read it, but did not think that Windows license would break though… so I blindly selected I want to continue and click continue.

I then finished creating my VM instance and my Boot Camp then launched in Mac OS, woohoo! I then entered my password in Windows. Once logged in, Parallels immediately took over and hid the boot camp instance and began to install their tools. After done (several minutes later) I received login prompt for Windows 10 again and I logged in. After things finished loading, I received a Toast Notification from Windows 10 asking me to verify my MS account again. Go there and I see a message in the account window that windows is no longer activated… oh no!

I now jump over to Activation under Update and Security in the Windows 10 Settings screen. Here it said my license is not longer valid (showing last 4 digits exposed, reset masked) and has only a button “Go to Store”. When you tap on this button, Windows Store opens for about 2 seconds, then you see it immediately closes with an error “File system error -1058340854”.

I then reboot my machine directly into boot camp thinking it was VM itself causing the error, but even direct boot I saw same error with no option to reactivate.


Solution 1: Reset Windows 10

First solution which I did and worked successfully was to reset Windows 10. To reset, go to Settings in Windows 10, then Update and Security and finally select Recovery tab. Here you can tap Reset and follow the prompts. I kept all personal files when asked what I wanted to do during Reset. The big drawback is all programs and apps are removed and takes a long time to reinstall all your applications if you have many like me.

Solution 2: Contact MS Support

This option is untested by me, but I remember people saying that there is a possible option to contact Support using the built in Contact Support app


Here you can explain the situation and request your free license to be reset. Again, I am not completely clear on the process and success, but if you want to give it a try, report back here your findings and I will update my Blog for others 🙂

Hope this helps! Let us know your experience below and I will keep everyone updated on results of my case with Parallels.

2 thoughts on “PSA: Use Caution with Parallels Desktop 11 and Windows 10 Free Upgrade *UPDATED*

    1. Jeff Kozloff Post author

      Not yet… I hate to rebuild my bootcamp all over again, but I think the risk is significantly less now, as the license key feature is now exposed in the Windows 10 Settings window where in the past it was hidden.



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