Microsoft Corp. is lowering the price by 70% of its Windows 8.1 for makers of inexpensive tablets and computers as they attempt to fend off their cheaper rivals such Chromebooks by Google, said people familiar with the company.
Manufacturers will pay $15 for a Window 8.1 license and preinstall it on tablets and computers that cost less than $250, rather than the $50 that was charged previously.
Strong competition from Google and Apple cut into revenue in the fourth quarter in the consumer licensing and devices division at Microsoft, as the computer industry saw its largest decline in annual sales on record.
Microsoft, which earlier in February named as its new CEO Satya Nadella, is looking to speed up its development and market introduction of its new devices.
It will not require products that are using the less expensive licensing to complete a logo certification, which is the process that verifies the compatibility of the hardware. Devices do not have to be touch screen to be part of the group.
Microsoft earlier said that it has already sold over 200 million licenses of its Windows 8 since it started on sale back in October of 2012. However, sales have sold at less of a rate than for the previous program Windows 7.
The regular list price for Windows is $50, but some of largest computer makers in the world paid $30 after the incentives were discounted such the marketing funds Microsoft provided.
Computer shipments globally fell by a record 10% during last year and have been forecasted to drop during 2014, as smartphones and tablets lure people away from the traditional notebook and desktop designs.
The tablets and smartphones are dominated by Google and Apple, whose systems of operation account for over 95% of the market.
