Microsoft has unveiled the price for its first tablet computer will match that of Apple's iPad, as the tablet wars heat up.

Microsoft's new tablet, the Surface, will start at $499 when it goes on sale Oct. 26.

The price matches that of Apple Inc.'s iPad, the most popular tablet computer, but the base model of the Surface has twice as much storage memory: 32 gigabytes. The screen is also slightly larger.

The signature hardware feature of the tablet, a cover that doubles as a keyboard, will cost another $100, Microsoft Corp. said Tuesday. A step-up model for $699 has twice the memory, 64 GB, and includes a cover.

The news comes as rumours swirl that Apple Inc. will soon be unveiling a mini iPad.

The launch of the Surface is an unusual move for Microsoft, which usually sells software to computer makers instead of making computers itself. It coincides with the launch of Windows 8, a version of the operating system that's designed to work better on touch-screen computers and tablets.

Microsoft will be selling the tablet in its own stores in the U.S. and Canada and online in those countries, plus Australia, China, France, Germany, Hong Kong and the U.K.

The Touch Cover has a working, printed keyboard on its inside surface, but the "keys" don't move when pushed. Microsoft will sell a separate Type Cover with keys that move for $130.

The first version of the Surface doesn't have a regular Intel-style PC processor and won't run regular PC software, but it does include a version of the Office suite.

Microsoft plans to release another version of the Surface some months later with a more traditional processor and the ability to run regular Windows programs. It did not disclose prices for that model.