"Microsoft needs new tablet partners just as badly as Intel does, which explains why it, too, has been going all-out to slash its prices for hardware OEMs – even going as far as to offer a new version of Windows that will cost nothing for makers of slabs with screens smaller than nine inches."
The problem Microsoft has, they compete with their partners. They have the Surface line and now with the acquisition of the Nokia handset division, they can be competing with their "partners" in two markets. With Nokia, Microsoft has even more resources at their disposal when it comes to hardware. Microsoft is killing their own partners. Take HTC, the last WP handset they released was a year ago. The fact is, Nokia was the strategic partner of Microsoft and all of their other partners were relegated to playing second fiddle. Why would any company want to partner with Microsoft on a tablet or a phone? Microsoft can either sell the hardware at cost, give the OS away or both when they make the device. Their partners doesn't have this luxury.
The fact is, when WP was first released, Microsoft should have been giving it away for free. It is too little too late as Microsoft is going down an empty road alone.