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Microsoft plans phones for under $100

In the face of increasing competition from Blackberry and iPhone, Microsoft announced today that it has plans to cut prices of Windows Mobile phones below $100.

AT&T Inc. began offering the 3125 Windows Mobile model for $49.99. Another phone will go on sale for less than $100 next month, Microsoft said, but the company declined to name who is selling the device.

Microsoft is working with manufacturers to make its phones easier to use, said general manager Scott Horn told Bloomberg News. The products also will become more affordable, he said.

"In the next few weeks, you are going to see prices really drop on a lot of our phones," Horn said.

"People expect to be able to do more and more with their mobile phone," Microsoft Chief Executive Officer Steve Ballmer said in the keynote address today to the Cellular Technology Industry Association (CTIA) of America. "We're building on our expertise across servers, operating systems and services to deliver Windows Mobile experiences that bridge the things people want to do at work and at home."

Ballmer also said he plans to focus on ways to help large companies make phones accessible to employees.

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