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Microsoft is looking to counter low-cost Chromebooks running Chrome OS

According to Bloomberg, Microsoft will slash Windows 8.1 licensing fees by 70 percent for makers of low-cost (priced less than $250) computers and tablets. This means that licenses will now be priced at $15 instead of $50.
Microsoft has experienced slowing growth in the operating system market with Windows 8. As we reported earlier this month, sales of Windows 8 thus far have failed to live up to its predecessor, Windows 7.
In addition, customer reaction to Windows 8 has been tepid, forcing Microsoft to make changes to how users interact with the operating system via the already released Windows 8.1 and the upcoming Windows 8.1 Update 1.

On top of its own internal issues that it has to grapple with, Microsoft is also fighting another battle on the low-end of the PC market against Google and computers running Chrome OS. In fact, low-cost Chromebooks running Chrome OS were able to secure 21 percent of the U.S. notebook market during 2013.
While a license fee reduction for Windows 8.1 will cover the PC and notebook market, the next step may be to make even more drastic price cuts with Windows RT. The Verge reported in December that Microsoft could make Windows RT free to OEMs in an effort to combat iOS- and Android-based tablets.

Source: Bloomberg

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RE: That's great but...
By fteoath64 on 2/22/2014 8:59:30 PM , Rating: 2
Kinda true. But MS is worried by Chromebooks and Android tablets in the low end because this cheap Win8 is targeting the same customer base. Bundling Office home and student edition helps somewhat in the product offering but hardware wise, Win8 tablets/laptops are crippled in performance compared to Android or Chrome-book.
Besides, Windows has a huge "support overhead" that the other platforms lack. It tends to have a high return rate or sold off cheap second-hand and replaced by an iPad or an Android tablet or even a Chrome-book. For most student users, all those devices are similar and can do most tasks needed for low end users.

There is good reason Microsoft needs that price parity in order to be considered. With existing pricing, it is not even in the considered list!.

"There's no chance that the iPhone is going to get any significant market share. No chance." -- Microsoft CEO Steve Ballmer

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