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Microsoft Corp slashes down Windows 8.1 price by 70pct to take on competitors: sources

February 21
11:36 PM 2014

People with knowledge of the matter told Bloomberg that Microsoft Corp is going to give a 70% discount for its Windows 8.1 product to manufacturers of affordable computers and tablets in a bid to compete against rivals like Google Inc's Chromebooks. They spoke on the condition of anonymity since the program details are confidential, the report said.  

The sources said that instead of charging manufacturers with $50 to obtain the license for Windows 8.1 and have it preinstalled on their devices, Microsoft will only be collecting $15 for those devices that cost under $250. The people added that only the retail price limit needs to be met to avail of the price cut since no restrictions apply on the size or kind of device, the report said.

Microsoft Corp's revenue in its devices and consumer licensing division got reduced last quarter due to fiercer competition coming from Google and Apple Inc. The period also represented the computer industry's largest yearly fall in history. Microsoft might just improve its share of the rapidly rising tablet market which is now valued at $80 billion by providing PC makers with incentives to come up with less-pricey models. The move could also help Microsoft fend off Google's Chromebooks notebooks, the report said.

Microsoft is trying to hasten the development and roll out of new devices. One source added that products using the discounted license will not anymore be required to finish logo certification, the process that determines if a hardware is compatible. The people added that the devices will not need to be touch-screen compatible to avail of the cheaper license, the report said.

Earlier this month, Microsoft said there were already 200 million licenses of its Windows 8 program sold since October 2012, representing a slower adoption pace compared to its predecessor Windows 7, the report said.

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