Microsoft has released Windows Phone 8.1 Update 1 Developer Preview. It includes new features like Live Folders and improvements to Cortana, Xbox Music and more.

Windows Phone 8.1 is a significant update for Microsoft's smartphone OS and it brings major new features and improvements to help it better compete with Apple's iOS and Google's Android.

The update has already started rolling out to Windows Phone 8-based Nokia Lumia handsets and if you haven't received it yet, we posted a leaked update schedule that provides a timeline of when each Lumia is expected to get the Lumia Cyan/Windows Phone 8.1 update.

In an effort to help developers get a jumpstart on updating and creating new applications for Windows Phone 8.1, Microsoft released a "Preview for Developers" application that lets anyone install Windows Phone 8.1 on their smartphones. We provided an easy to follow guide that provides step-by-step instructions on how to install Windows Phone 8.1 on any current WP8 smartphone.

Microsoft recently announced Windows Phone 8.1 GDR1, which is expected to be released later this year. The company has just released the update to anyone who is currently using the Windows Phone 8.1 Preview for Developers. To get the update, users just need to go into the Settings app on their smartphone and tap Phone Update. We just installed it on our T-Mobile Nokia Lumia 520 and are very impressed, here's a quick rundown of what Microsoft has included in this update.

Cortana - is now supported in more regions and U.S. Windows Phone 8.1 GDR1 users will notice Microsoft's personal assistant has a few new tricks up her sleeve. There are new natural language scenarios; snooze time for reminders and the ability to launch Cortana hands-free when connected to automobile Bluetooth car kits. To bring up Cortana, simply say "Call Cortana" and the assistant will automatically launch.

Live Folders - is a feature Windows Phone fans have been asking Microsoft to include and the company has delivered. Users can now organize applications into folders right on the Start screen. The feature works just like it does on iOS and Android, just drag a tile over another tile and a folder is automatically created. Users can then change the name of the folder by opening it and also arrange and resize the tiles on the Start screen.

Xbox Music - has been updated with significant performance tweaks that make load times much faster and Microsoft will be adding a new "quickplay" feature this month and Kids Corner support.

For a complete rundown of all of Windows Phone 8.1 Update 1 (GDR1) features, Microsoft has posted detailed information on its Windows Blog.

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