Microsoft on Monday sent out invitations to a September 23 event at which it is expected to unveil new Surface tablets to challenge iPads and Android devices dominating the market.

The event to be held in New York comes as the US technology giant struggles to remain relevant as Internet age lifestyles shift from traditional computers to smartphones and tablets.

Email invitations to the "Surface NYC event" revealed little more than time and place details displayed over a graphic image of a Surface tablet and matching keyboard.

Microsoft last month knocked $100 off the price of high-end versions of its Surface tablet, which is competing against Apple's iPad and devices that use Google's Android system.

The software giant's online store is offering US consumers the Surface Pro for $799 or $899, depending on memory capacity, down from $899 and $999 respectively.

The Surface RT is a basic version of the tablet, which got a 30 percent price cut earlier in the year after failing to gain traction in the market.

The Surface RT price dropped to $349 from $499.

The promotion came on the heels of shabby tablet sales that resulted in Microsoft taking a $900 million charge against fourth quarter earnings, which closed at the end of June.

The charge exceeds sales of the tablet since it was launched at the end of October 2012, estimated by the company at $853 million.

Surface was introduced to showcase Microsoft's new Windows 8 operating system, which was launched at the same time in a bid to make up for ground lost to Apple and Google in the mobile domain.

Pressure on Microsoft to avoid becoming obsolete in the rapidly evolving technology world has triggered an overhaul of Windows; early retirement plans for chief Steve Ballmer, and the multibillion-dollar buy of Nokia's handset business.

The deal worth $7.2 billion (5.44 billion euros) gives Microsoft Nokia's mobile phone operations along with an array of patents and licenses to help compete with rival platforms.

The deal also moves Nokia chief executive Stephen Elop, who was hired from Microsoft in 2010 to turn the company around, back to his former firm, and makes him a likely candidate to succeed Ballmer when he retires.

Microsoft chief executive Steve Ballmer announced has announced he will retire by August of next year.

Ballmer took over as CEO in 2000 from co-founder Bill Gates, a classmate and friend from their days at Harvard University in the 1970s.

When Ballmer took over, Microsoft was the undisputed tech sector leader, and the world's largest company in market value. But in recent years it has struggled as consumers move from desktop and laptop PCs to mobile devices.

Eyes on Apple for new iPhones
San Francisco, California (AFP) Sept 10, 2013 - Apple's shares climbed and rumors sizzled ahead of an expected move on Tuesday to expand the iPhone domain with a pair of new models, including one aimed at China.

Analysts believe a special event at Apple's headquarters in Silicon Valley will spotlight a more economical iPhone priced to compete in emerging markets where money is tight, along with a beefed-up top-end model.

"The key challenge for Apple this week is to demonstrate that it can maintain momentum in overall iPhone sales, and to do so in a way which won't drive down margins significantly," said Ovum chief telecoms analyst Jan Dawson.

"It's key for Apple to be able to find ways to drive growth at a higher rate again, and getting China's biggest carrier on board and launching a cheaper version of the iPhone are both key to doing that."

Apple became a Wall Street darling by pairing blistering sales of culture-changing gadgets such as iPods, iPhones, and iPads with enviable "margins," the difference between cost and price.

Forrester analyst Charles Golvin told AFP the consensus is for Apple to unveil a new high-end phone, "most likely called the 5S, with the same look and feel physically but with a speed boost; new processor, and new graphics capabilities."

A lower-cost iPhone has been dubbed the 5C, "because it would come in multiple colors analogous to today's iPod touch," Golvin said.

Speculation about the iPhone 5S included the debut of a gold color and fingerprint recognition for enhanced security.

"For the most part, we view the iPhone5S as an evolution of the iPhone5 and as such do not view it as especially innovative," Citi Research said in a note to investors on Monday.

"However, with the inclusion of a fingerprint reader, Apple opens itself up to new opportunities, most notably mobile payments."

It remained unknown how low a price Apple would be able to hit with the 5C.

Gartner estimates that mobile phones priced $300 or more accounted for only 13.7 percent of overall phone sales last year, according to Citi.

Analysts were keenly focused on the promise of a 5C to win over buyers in China and other developing markets, where there is fierce competition from low-priced smartphones powered by Google's Android operating system.

FBN Securities on Monday predicted that launching two new iPhones would reverse gains made by Android-powered rivals in the market.

Apple shares were up nearly two percent to $506.17 at the close of the trading day on the Nasdaq exchange.

Apple has also invited press to a Wednesday event in Beijing that analysts believe signals a deal to add iPhones to China Mobile's massive telecom network in that country.

"The only real potential to surprise investors seems to be in the scope and velocity of a new China strategy and any new features within iOS 7 and fingerprint scanner technology," Barclays Equity Research said in a note focused on what is expected from Apple.

Apple's iPhone franchise has historically focused on premium products at premium prices, essentially leaving the company "unable to address" approximately 60 percent of the opportunity in the smartphone market, the investment bank Cantor Fitzgerald said in an analyst note.

"We expect this to change with the introduction of the plastic-encased iPhone 5C," Cantor Fitzgerald said.

Analysts did not foresee any talk of Apple watches or TV at the Tuesday event.

The smartphone market is now dominated by Android devices, with roughly three-fourths of all handsets, but a forecast by research firm IDC suggested Apple will increase its share this year to 17.9 percent from 16.9 percent.

At the heart of any iPhone announcements on Tuesday would be a dramatic overhaul to the iOS software powering Apple handsets.

New iOS 7 software will debut with a free iTunes Radio Service featuring more than 200 stations "and an incredible catalog of music from the iTunes Store," Apple announced earlier this year.

The streaming radio service is part of what Apple chief Tim Cook branded the biggest change to iOS -- Apple's mobile operating system -- since the introduction of the iPhone in 2007.