Microsoft unveiled the Windows Phone 8.1 update at the Build developer conference in San Francisco Wednesday.

"We believe Windows Phone is the world's most personal smartphone," said Microsoft's Corporate Vice President for Windows Phone Joe Belifore.

The latest version of Windows Phone includes Microsoft's long-rumored personal assistant Cortana, which is functionally similar to the iPhone's Siri.

Belifore said the Bing-powered Cortana, is launching in the US in beta, was inspired by real-world personal assistants. Cortana can schedule appointments, set alarms and find nearby restaurants. It can also send contextual reminders— reminding you to ask your sister about her new puppy the next time you talk to her, for example.

Image: Mashable, Pete Pachal

The assistant also supports searches for content stored locally on your device and works with third-party apps like Hulu and Facebook.

The 8.1 update also includes a new action center that displays stats like Facebook notifications and battery information and a refreshed start screen.

Windows Phone Store has also been refreshed with new categories, quick links, and larger tiles to make it easier to find apps.

Belifore also demoed a new Wi-Fi Sense app. The app learns about nearby wifi networks and automatically connects you to local hotspots. The service also provides a way to share wifi networks with others without revealing a password.

Skype is also integrated in new ways in the 8.1 update. Users can now switch directly to a Skype voice or video call from within phone calls.

Microsoft has also revamped the keyboard in Windows Phone 8.1. The new "wordflow" keyboard supports gesture-based typing, similar to those found on Android. Belifore said the new keyboard is the fastest smartphone keyboard available and, in fact, holds the new world record for fastest smartphone typing.

Belifore said the update will be rolling out to existing Windows Phone users in the "next few months" and will ship on new devices beginning in late April and early May.

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