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Microsoft Cutting Costs of Windows RT to Compete with the iPad

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Microsoft may be preparing to lower the cost its hardware partners pay to ship devices running Windows 8 in an effort to better compete with the tablet offerings of other companies.

According to Bloomberg, sources they spoke with indicate that Microsoft is preparing to significantly lower the price companies like Dell, Lenovo and HP pay to use the Windows RT operating system in their PCs. Windows RT is the version of Windows 8 that runs on system-on-a-chip architectures like those used in smartphones and tablets like the iPad.

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The Asus Vivo Tab RT, which runs Windows RT

It’s this version of Windows that allows Microsoft to compete with Apple and Google tablets on specifications and price.

Reportedly, lowering costs to manufacturers is only part of how Microsoft plans to give the Windows RT operating system the boost it needs to compete. Indicators also point to a refreshed line of devices running Windows RT from Dell, HTC and others.

Last year, Windows RT only made it into about four products that shipped to consumers worldwide, including the Dell XPS 10, Asus VivoTab RT, and Microsoft’s own Surface RT. Shipping estimates compiled by IDC indicated that of all of those, Microsoft’s Surface line eclipsed the tablets of its partners by a wide margin.

Read: Microsoft Shipped 900,000 Surface Tablets, Claims IDC

Last year, reports indicated that the price users paid for Windows RT hovered somewhere around $85 per device, however as the price each OEM pays is highly confidential, there’s no way to independently  confirm how accurate those reports were, nor how much of a discount these partners will now be given.

What we do know is that Windows RT devices will need to hit lower price points if they are going to compete on an even footing with other tablet ecosystems. Apple’s iPad mini starts at $329. In comparison, Microsoft’s Surface RT starts at $499 while the RT tablets of its partners start around that same price.

News of a fresh push from Microsoft on the Windows RT front comes the same day as its partner Acer formally announced the world’s first Windows 8 machine with an 8-inch display, the Acer Iconia W3. As it will ship for around $400 with a traditional Intel ATOM processor and thus can run all of the Desktop applications that Windows RT devices can’t, the time for Microsoft to push Windows RT is now, before Intel machines become cheap enough to strangle the platform.

Travis Pope is a Reporter-at-large for GottaBeMobile. He's currently enjoying a romp in the dangerous quicksand that is Microsoft's Windows 8, Windows Phone 8, and Xbox ecosystem.

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