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Microsoft launches a price assault on Chromebooks

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Microsoft is aiming straight for Google’s Chromebooks this holiday season. At the company’s partner conference today, Microsoft COO Kevin Turner revealed that HP is planning to release a $199 laptop running Windows for the holidays. Turner didn’t provide specifications for HP’s "Stream" device, but he did detail $249 laptop options from Acer and Toshiba. Acer’s low-cost laptop will ship with a 15.6-inch screen and a 2.16GHz Intel Celeron processor, and Toshiba’s includes a 11.6-inch display. It appears that Intel’s Celeron chips will help Microsoft’s PC partners push out cheaper devices in the race to the bottom.

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Turner also revealed that HP is planning to release 7- and 8-inch versions of its new "Stream" PCs for $99 this holiday season, both running versions of Windows. "We are going to participate at the low-end," says Turner. "We’ve got a great value proposition against Chromebooks, we are not ceding the market to anyone." Microsoft has been gradually cutting Windows license costs to allow PC makers to reduce their device prices, and it’s clear the software maker is taking the Chromebook threat even more seriously this year. While Microsoft has attempted to undermine Chromebooks previously, competitive pricing will likely have a bigger chance of stemming any threat from Google’s laptops. Microsoft will just have to ensure that its PC partners don’t turn this pricing opportunity into a second round of underpowered Netbooks, otherwise the simplicity and performance of Chrome OS might just tempt holiday shoppers away from Windows.