Report: Microsoft To Cut Windows 8.1 Price For Low-Cost Devices

Microsoft is planning massive price cuts to spur adoption of low-cost Windows 8.1 devices, according to a Bloomberg report.

“Microsoft Corp. is cutting the price of Windows 8.1 by 70 percent for makers of low-cost computers and tablets as they try to fend off cheaper rivals like Google Inc.’s Chromebooks, people familiar with the programme said,” stated Tim Culpan and Dina Bass in their report.

Price cut

Instead of paying the usual $50 (£31), OEMs will be charged $15 for Windows 8.1 licences that ship on devices that retail for less than $250. “The discount will apply to any products that meet the price limit, with no restrictions on the size or type of device,” according to Bloomberg’s unnamed sources. Bloomberg said the price cut appears to be intended to help Microsoft gain a larger share of the $80bn tablet market.

Chromebooks are thin-client-like devices that are based on Google’s Chrome OS. Designed to boot quickly and hook into Google’s cloud-based app ecosystem, Chromebooks offer an affordable alternative to full-blown Windows and Mac notebooks. While comparatively low-spec, adoption is on the rise.

Chromebook sales surged last year, according to market research firm NDP. Through November 2013, Chromebooks sales rose from practically nothing the year before to 21 percent of the commercial notebook market.

“The market for personal computing devices in commercial markets continues to shift and change. New products like Chromebooks, and reimagined items like Windows tablets, are now supplementing the revitalisation that iPads started in personal computing devices,” said Stephen Baker, vice president of industry analysis with NPD, in a statement.

Windows PC sales

That growth came at the expense of Microsoft’s OS. “Tepid Windows PC sales allowed brands with a focus on alternative form factors or operating systems, like Apple and Samsung, to capture significant share of a market traditionally dominated by Windows devices,” stated Baker.

Tami Reller, Microsoft’s executive vice president of marketing, said earlier this month that after 15 months on the market, the company had sold 200 million Windows 8 licences. While a seemingly impressive figure, it falls 100 million licences short of its popular predecessor, Windows 7, at the 15-month mark.

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Originally published on eWeek.