Windows 10
Microsoft is working on a cheaper version of Windows 10 called Windows 10 Cloud. REUTERS/Thomas Mukoya

Microsoft appears to be preparing a new operating system called Windows 10 Cloud. Sources have indicated that the still-unannounced software might be a simplified version of Windows 10 that would directly compete against Google’s Chrome OS-powered Chromebooks.

A reference to the “Windows Cloud” was first spotted within the insider builds of Windows 10 software development kit 15003. There are also terms listed as Cloud and CloudN inside the insider test build as well. At the time, people speculated that Windows 10 would have the capability to be streamed from Azure, or perhaps Microsoft was preparing a new cloud storage subscription plan of some sort.

Sources say that Windows 10 Cloud is actually a simplified version of Windows 10 that will only be able to run Unified Windows Platform apps installed from the Windows Store, according to ZDNet’s Mary Jo Foley. This would enable Microsoft to sell a simpler and cheaper version of Windows 10 in order to rival Chromebooks.

Chromebooks, which are powered by Google’s Chrome OS, are a lot more affordable than full-fledged Windows 10 laptops and Apple MacBooks. One caveat of owning a Chromebook however is that it primarily depends on an internet connection because it relies mostly on web-based apps.

With Windows 10 Cloud, the operating system is said to be similar to Windows RT and Windows 8.1 with Bing. Both of those were low-cost versions of Windows 8, but both failed to appeal to a large market. If Microsoft is indeed planning on another low-cost operating system, Windows 10 Cloud would give PC makers an opportunity to build more affordable laptops that would rival Chromebooks.

As for when it might actually be released, it’s possible that it might arrive soon. References of Windows 10 Cloud can already be seen in the insider build of Creators Update for Windows 10 which is due to arrive in April, as pointed out by The Verge. It might also possibly be released later this year alongside a second major update to Windows 10.