Phones will reach price points that "will really surprise you".
Smartphones and tablets running Microsoft's Windows software will fall below $200 this year, according to Microsoft's VP of OEMs Nick Parker.
Speaking to reporters at the annual Computex IT computing show, he said: "We'll reach price points that are very industry competitive for 7, 8, 10-inch devices. They will really surprise you. Last year, we were in the threes, fours, 500 dollars [range]. This year, we'll be ones, twos, threes."
Microsoft is attempting to gain stronger footholds in the mobile market share that is currently under control of mostly Android-powered devices and iPhones.
According to Netmarketshare, Android currently has a 41.58% market share in operating systems on mobile devices. Apple's iOS operating system has a 48.34% share, but Windows Phone stays behind with a 2.1% share.
Earlier this year, Microsoft made Windows free for devices smaller than 9 inches in an attempt to boost market share. The firm also made Microsoft certificates free for some markets to try and entice more OEMs into running with Windows software.