Microsoft to drop price of Windows 8 licenses 70% for low-end devices, report says

Boot-to-desktop also to become standard for non-touch PCs, according to anonymous source.

In a bid to stave off competition in the low-end tablet and notebook market, Microsoft will be reducing what it charges device manufacturers for its Windows 8.1 licenses, according to a Friday Bloomberg report that references anonymous sources. For devices that retail for less than $250, the cost of a Windows 8.1 install will drop from $50 to $15, with no restrictions on the type or size of the hardware, Bloomberg reports.

It's a move that could inspire manufacturers to make super-low-end Windows tablets, but might have even greater impact in the notebook space, where manufacturers are moving toward sub-$250 Chromebooks running Google's free Chrome OS. Take, for example, Samsung's Chromebook 3, which retails for $230. If that machine were running Windows, a huge chunk of its build-out costs would be going to Microsoft--and the notebook probably wouldn't cost price-conscious consumers just $230.

Windows 8 is selling poorly relative to Windows 7, with some 200 million licenses sold since Windows 8 was released in October 2012. For comparison's sake, Windows 7 sold 240 million licenses within its first year.

Obviously, the traditional PC market is losing a battle of relevance to tablets. The public's poor reaction to the Windows 8 interface doesn't help. Nor does the dearth of rock-star-caliber apps in Microsoft's Windows Store. But the currently high pricing of Windows 8 only impedes Microsoft's efforts to place Windows in inexpensive, commodity-caliber devices. Successful sub-$250 Android tablets tell us there's a market of interested consumers who don't want to spend $299 on an iPad mini.

On Friday, The Verge reported that the 70% price reduction is part of larger revision of licensing policy, according to anonymous sources familiar with Microsoft's plans. The most intriguing change: Microsoft would automatically boot Windows to its desktop on non-touchscreen hardware.

Score another win for traditional PC users. Microsoft is clearly getting the message.

This story, "Microsoft to drop price of Windows 8 licenses 70% for low-end devices, report says" was originally published by PCWorld.

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