Complex sentence: Later that month, three Microsoft spokespeople said the iLoo was a hoax, but it was clarified afterwards that the concept was real, but Microsoft decided not to move forward with it because of the impact it might have on their image.
Split into simpler sentences: Later that month, three Microsoft spokespeople said the iLoo was a hoax. It was clarified afterwards that the concept was real, but Microsoft decided not to move forward with it because of the impact it might have on their image.