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Microsoft promises lower prices on Windows tablets, phones

Tablet prices will fall to the $100, $200, and $300 range, a Microsoft vice president tells the Wall Street Journal.

Dell's Windows 8 Venue 8 Pro tablet CNET

Windows tablets and smartphones will be cheaper this year, according to Microsoft.

Prices on 7-inch, 8-inch, and 10-inch Windows tablets will become more competitive, Nick Parker, Microsoft's vice president of OEM partners, said at this week's Computex Asia trade show, the Wall Street Journal reported Thursday.

"We'll reach price points that are very industry competitive for 7, 8, 10-inch devices," Parker told reporters at Computex. "They will really surprise you. Last year, we were in the 3s, 4s, 500 dollars. This year, we'll be 1s, 2s, 3s."

The consumer cost of Windows Phone handsets will also drop to less than $200 in certain markets this year, Parker added.

Slashing the price on Windows tablets could help Microsoft win over more customers in a market dominated by the iPad and lower-cost Android devices. Rival tablets such as the Google Nexus 7 , start at around $200, though the Amazon Kindle Fire 7 undercuts much of the competition at just $139. In contrast, comparable Windows tablets still tend to run higher. Microsoft's own Surface Pro 2 rings in at $900, though it offers much greater memory and far more features than the average Windows 8 tablet.

But lower prices will only go so far. Windows 8 hasn't exactly been greeted with open arms, challenging Microsoft to convince consumers to choose a Windows 8 tablet over an iPad or Android device. In the smartphone arena, Windows Phone has grown in popularity and market share but still runs a very distant third to leaders Apple and Android.

In April, Microsoft announced that it would start offering Windows for free to manufacturers of phones and tablets with screen sizes under 9 inches. That move will pave the way for device makers to in turn lower the prices to consumers.