Steve Ballmer admits Surface defeat

By , Jul 26, 2013

Surface

Microsoft CEO Steve Ballmer Thursday played Captain Obvious, telling Microsoft workers the company may have overestimated demand for its Surface tablets. Really? The revelation comes only after the software giant announced a nearly $1 billion writedown after slashing Surface prices.

Not willing to take such things as a sign to go off and do something else, Ballmer and operations chief Kevin Turner reportedly told a closed-door town hall meeting a new Surface is now being tested…

“We built a few more devices than we could sell,” the Microsoft CEO said at the meeting, according to NeoWin. Commenting on the lukewarm reception to Microsoft’s Windows 8, the CEO said “we’re not selling as many Windows devices as we want to”.

The admission follows a string of Microsoft ads meant to downplay Apple’s enormous lead in tablet usage by using Siri to speak about the virtue’s of the Surface.

In reality, the attempt elicited mostly giggles.

Not laughing were Ballmer and associates who said that ginormous writedown was needed because it took cutting the Surface RT price by 30 percent to sell the things. But like a blacksmith trying to sell horse shoes to Prius owners, Microsoft still thinks the Surface can be salvaged.

Another data point:: Microsoft’s share of connected devices sales has plummeted from 90+ percent in 2009 to less than 25 percent.

Microsoft share of connected device sales

The next Surface – whatever it is called – is being tested “with incremental improvements,” according to the reports.

Should someone tell Microsoft that ship has sailed?

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  • omrishtam

    well…at least he admitted surface death but he could add another device *cought* xbox one *cought*

    • Markus Hudobnik

      Is it really dead? No it isn’t. the x1 is FAR from being dead.

    • Joshua Catimpo

      Umm… Be sure about what youre talking about… They changed rules
      Of xbox! Xbox one can now share games. Now, you can play games without connecting to wifi, or the 24 hour thingy, its gone. So basically ps4 and xbox are tied up!

      Correct your facts before conplaining about it! Xbox one wont die, it just got its game back on

      • Gus Me

        They changed their minds after saying they wouldn’t… What makes you think they won’t do the same once they have peoples money?

      • Markus Hudobnik

        You are delusional if you think that. Microsoft changed it’s policies for the gamer, no other reason.

      • Kenrick Fernandes

        exactly. they changed it for the gamer.

      • SkyFall

        I think Microsoft changed its policies not for the gamer but because if they kept DRM and 24 hour checking most of the people would buy PS4 and they would loose a ton of money. So I believe they changed it so that they get more money, no other reason.

      • Markus Hudobnik

        See this is what I don’t understand. Money correlates to popularity. So obviously they changed it for money, but money correlates to their fanbase.

      • TinTonB

        Yeh, no.

        It’s all to coincidental that they made these changes just around the time in which the first pre-order statistics were published from amazon.

        Me thinks MS wanted to make some more money! ;)

      • Markus Hudobnik

        Obliviously!!!!! But making more money EQUALS more fans.

      • TinTonB

        That’s quite a correlation you have there.

        I think you mean “More unit’s sold equals more fans.”

        There profit margins won’t have a direct effect on the amount of fans a company will have.

  • darkdude1

    They need to try price it closely to the Nexus 7 and iPad, I don’t know, is it Windows 8? Is it the device itself? The pricing certainly wasn’t right to begin with.

    • https://twitter.com/MrElectrifyer MrElectrifyer

      You sound like you’re talking about the Surface Pro (a full fledged PC in tablet form). The article is only referring to the Surface RT, yet they refused to specify it, just to mislead readers into blindly criticising the product.

  • jocastro

    hahahaha totally knew this was going to happen, stick to game consoles because its the one thing they are good at, apple defeated the shit out of you…..

    i still love PlayStation more………………… cant wait for ps4

    • Liam Mulcahy

      true

      • Gorgonphone

        yup

      • Misti curia

        While I agree with your point you are still a c*nt so I am down voting you.

      • Gorgonphone

        And for that im changing your name to Mr. Estrogen haahHHHahhah silly human

    • mehrab

      PS4!!!!!

  • Liam Mulcahy

    Microsoft is dead. Except the Xbox. Wow. I think Microsoft is turning into a gaming company.

    • jocastro

      agreed

    • Boss

      The Xbox makes them no profit it all comes from Windows sales

      • Gorgonphone

        yeah they survive off windows..

      • Liam Mulcahy

        No. look Above idiot. Windows is failing. Xbox is not.

      • Boss

        If it wasn’t for Windows they wouldn’t even have money to keep the Xbox alive

    • Mohammad Ridwan

      Xbox 360 was great… Xbox One… not so much… gamers are pissed at M$ for screwing them with DRM yada yada….which they changed finally after online shit-storm… even after that, it’s not that compelling… It’s $100 more than PS4, which is a superior in hardware, software and design… than XBone…

      • Markus Hudobnik

        Software not at all. hardware yeah, but they have essentially the same specs, with ps4 slightly winning. I really don’t see the difference between the two. Microsoft screwed the x1 in the beginning, but they fixed it. It’s almost the same as the ps4

      • Rowan09

        It’s costs $100 more, Sony on the PS3 was killed by Mocrosift because they said Sony shouldn’t have included wifi and bluray on the PS3 and they turn around and add a useless camera for $100 more that the system needs to function. I have the kinect and without a ton of room it’s not useable and it’s not for real games

      • Markus Hudobnik

        I understand the limitations of the first kinect. But have you even looked up info on the new kinect? It has some pretty awesome potential and the only way for it to be actually developed for is to include it with every xbox one

      • Rowan09

        It’s not for hardcore gamers. No one is going to play Call of Duty, Halo, Gears or Battlefield using a kinect don’t get me wrong the tech is cool on both the old and new but motion gaming in majority is for kids and certain games. I guarantee if you ask people to pay $100 less and no kinect they would choose that option over the system with an always on camera.

      • Dani Hayes

        What is a “real gamer”?? Times change. Board gamers could be “real gamers”.

      • Mohammad Ridwan

        By software, I meant WIndows OS which is in XBone (for fast switching between TV and Gaming) uses 3 GB of memory, but PS OS uses 1 GB… That’s a 2 GB win right there…

        Plus GDDR 5 (PS4) is far superior than DDR3 (XB1)

      • mehrab

        The ps4 will have better and more games and will have fRther more optimization and bcos of the ram everything Arounf you in the gaming environment will look more detailed

      • Markus Hudobnik

        There are recent reports that ps4 is actually only going to have 5.5 gb usable ram. As for the drr3 and the gdrr5… they each have there own pros and cons. Still overall ps4 will have a little better graphics, but now they are closer than ever…

      • Liam Mulcahy

        Yeah I like Xbox 360 better than PS3. But I think PS4 will do better because of its lower price.

      • Markus Hudobnik

        I agree. Just hate when people dismiss the Xbox one. It is really good competition.

      • Liam Mulcahy

        yeah maybe
        the Xbox one has Hidden Quality we can’t see. like apple’s products.

      • mehrab

        Pul leaseee the xbox 360 showed me the red lightnof death in two months

  • Rowan09

    It’s over don’t try to beat a dead horse. If it was just specs people would have bought the Surface Pro. The Pro is a laptop wanna be when a tablet is suppose to be a media/gaming/notebook. Even if they sold it for the same price as the Nexus and Galaxy tabs it still wouldn’t be able to compete.

    • Vitaliy Anonymous

      They are talking about the RT, not the Pro.

    • Liam Mulcahy

      Yeah I think if surface pro apps where better. Microsoft would sell more.

    • Misti curia

      If the pro was 300 bucks it would sell like hot cakes

      • Rowan09

        Don’t agree because the Nexus is cheap and it doesn’t sell like hot cakes and neither did the Playbook or the Touchpad. It’s more than just the price.

      • Misti curia

        But the surface pro is basically a laptop with a touch screen, I mean it can run all windows programs

  • Boss

    he left it too late just like blockbuster with Netflix

    • Liam Mulcahy

      Yeah

  • Tonka Thor

    I said it before, people don’t know whether it’s a tablet or a laptop. It’s priced at a laptop price, it comes with a keyboard but it’s advertised as a tablet and it’s huge! Not to mention windows 8 just really really sucks.

    • Gorgonphone

      it looks lame it is lame and now its dead… NEXT

    • Markus Hudobnik

      and why does windows 8 suck?

      • Tonka Thor

        Because when I use it, I end up switching to the old desktop that’s why it sucks.

      • Markus Hudobnik

        That makes no sense? Windows 8 was built to incorporate the desktop… I personally don’t use the start screen except for launching and searching for desktop apps. The overall speed improvements, the task manager, etc. etc. I really don’t see what there is to complain about. I feel like it’s the hate bandwagon. People always jump on that.

    • https://twitter.com/MrElectrifyer MrElectrifyer

      Yet another mislead reader, this is only referring to the Surface RT; the one that was priced the same as the iPad yet offered far more functions.

      • Tonka Thor

        Oh my molestake, That’s another problem with MS. The marketing is terrible. How many versions of windows 8 are there? How many different variations of tablets? What version of windows runs with what machine etc etc.

      • https://twitter.com/MrElectrifyer MrElectrifyer

        I’ll agree they have a terrible marketing team, but they do distinguish their products pretty well. You just have to learn their name, like every other product (e.g. iPad 2, iPad with Retina, iPad mini, Mac OS X Snow Leopard, Mac OS X Lion, Mac OS X Mountain Lion, Mac OS X Maverick, etc.). Fanboy Ed here (worst iDB blogger) just refused to specify the version, misleading readers into criticizing the entire Surface line (Surface RT, Surface Pro). Always take what he blogs with a bucket of salt, ’cause there’s 99% chance he’s typed BS he just pulled out of his ass. No proof reading, no facts, just fanboy idiocracy and click baiting.

        BTW, there’s 3 editions of Windows 8: Normal, Pro and Enterprise. All can run on any machine. RT is a watered down version compiled for weak ARM processors.

  • Canchume

    YESSS YESSSS YESSSS ¡¡¡¡¡¡¡

  • ✪ aidan harris ✪

    Even if Ballmer is admitting defeat I don’t think the Surface is dead just yet. The main problem is it’s just way too overpriced. People keep saying its a powerhouse with specs better than every other tablet and laptop but then I think that’s part of the problem I mean I haven’t seen the device for myself but it looks huge. If the Surface is to be touted as a potential laptop replacement then it could at least be a little bit smaller. Then again I’m sure many people that own the device do not take it out of their house and as such do not mind if it’s a little large. Despite all of the above though I do think that the Surface will be successful as soon as either the price is decreased or more people earn more money to be able to afford the thing…

    • Gorgonphone

      “I don’t think the Surface is dead just yet.” that sounds like electronic necrophilia ahahhahaha

    • Vitaliy Anonymous

      I think you are talking about the Surface Pro, not the RT.

      • ✪ aidan harris ✪

        Yes I am. It was my understanding that they’re not selling well either. Or am I wrong there?

      • Vitaliy Anonymous

        That’s true, I’ll admit it. And part of the reason I would say, is marketing. They need to focus on good parts of it, and market that (Office, ports, multi-user accounts etc.) rather than do keypad dancing. They did drop the price.

  • Saeed Ghattas

    Anyone remembers steve ballmer’s intreview when he mocked apple’s iphone? LOL.

    • Vitaliy Anonymous

      That’s why I wish Bill Gates would focus back on being the CEO of MS, but of course, with what he is doing with his foundation, that is a selfish thought.

      • GuyBey0ndC00L

        Bill Gates needs to do a Steve Jobs (RIP) come back and save Microsoft. Steve Ballmar (CEO) has been doing a terrible job and MS image is very bad right now. From phones to tablets, from PC (some) hardware and software plus they almost destroy Xbox brand Microsoft is looking terrible and confuse. I only hope restructuring the company will help.

      • Vitaliy Anonymous

        As much as I like Microsoft, I can hope the same for Apple, that Tim Cook can keep it running as good as Steve Jobs did, or even better.

      • GuyBey0ndC00L

        I agree, I hope Apple doesn’t fall back to the dark ages and I hope Microsoft gets out of theres soon.

  • geekinit

    The kick stand sucks, the battery life sucks, the amount of free hard disk space sucks, the noisy CPU fan sucks, the lack of retina display sucks… no wonder it’s not selling. Microsoft is about 3 years late with this product.

    • Gorgonphone

      perfectly said

    • Jackson Grong

      App support, for me the no. 1 reason why I have the iPad, suck!

    • mehrab

      *windows 8 sucks too*

    • Vitaliy Anonymous

      Okay, honestly comments like your piss me off. Furthermore proves that Apple fanboys are arrogant people, who will worship the ground that Steve Jobs (R.I.P.) or Tim Cook walks on. To defend the competition (remember, competition is good for the consumer), I am going to disband every single one of your statements.
      *The Kickstand Sucks: From what perspective? It is not in the way, it does not bother at all. You don’t have to buy an extra case just to prop the device with the iPad. Good luck forking out extra $40-60 just for a case (I worked in retail before).
      *Storage Sucks: Here is something that’s going to blow your mind. For $499, the iPad 16GB has around 14GB left over. Previously, for the same price, the Surface RT 32GB also had ~16GB left over. Here is the magic: for the same price, you had the same amount of free space, but the Surface is a more full featured device.
      *Noisy CPU fan sucks: umm, as far as I know, the RT does not even has a fan, because it is not too crazy powerful to run intense software, therefore, it is not a requirement.
      *Lack of retina sucks: retina is just a name. The surface RT has a 720p screen quality. Furthermore, the screen and digitizer have been fuzed together, thus having the display as close to the front as it gets, keeping the display as clear as possible. Third thing, for a device that small, 1080p vs 720p is not noticeable to a human eye unless you have some crazy 30/20 vision. If it was a 23″ tablet (aka All-In-One), then your 2048×1536 resolution would make more sense.

      So please, before you get all arrogant, please note a couple of these things:
      *Apple is a company (not a cult) that makes great products. Please support it as much as you want, but please worshipping it.
      *Understand that competition is healthy. You want Microsoft dead? Android dead? Well, good luck seeing more major improvements.
      *Before you perform the “Christian Zibreg” (bashing competition), please do some research. You are acting like a child.

  • Gorgonphone

    ahahaha din dong the big ZUUUN is dead… and here come the crying android fan boys

  • Ted Forbes

    I have a laptop, desktop, iPad, iPhone. I don’t use my desktop, I hardly use my laptop and I only use my iPad at home nowhere else. So, please, remind me again why I need a surface?

    • Gorgonphone

      i have iphone ipod ipad and laptop i use all every day

    • Canchume

      i have a macbook pro, a mac mini, a powermac g5, a imac g3, a iphone,ipad,ipod nano, and i use all in my day

  • Jacob S

    Thank you Mr.Ballmer, you are a gentleman!

  • Markus Hudobnik

    Windows 8 is still great. As long as they keep producing quality OS’s then they will be okay.

  • Markus Hudobnik

    But really the surface sucked. If the surface pro was marked at $500 then they might see some numbers.

    • https://twitter.com/MrElectrifyer MrElectrifyer

      Yeah, just like Apple and every other high-performance Ultrabook manufacturers. You can wait for another 3-4 years then the price of i5 ultrabooks would be around $500, or just get a weaker performance Atom Ultrabook for $500. Can’t be expecting them to price such high-end hardware at a low-end value, when every other manufacturer isn’t doing so…

      • Markus Hudobnik

        Yeah, I guess.

      • Saeed Ghattas

        It’s not a high end product though!
        I would pay 800$ for any apple product but not on any other product!

      • Raashid

        What exactly makes it high end? The Apple logo? Give a non-iTard explanation of your reasoning…

  • Chuck Finley

    What you mean is failure with the Surface RT.

    The Surface Pro is actually pretty decent and isn’t doing too badly.

    • Markus Hudobnik

      If the Surface Pro was $500 i would totally get it.

  • n0ahcruz3

    Atleast he got balls to admit it.

  • Decio Arruda

    I was actually debating if I should get a Surface RT when it first came out because it just looked so good and, windows 8 didn’t look bad at all in tablets. But now I’m glad I’ve stuck with the iPad, iOS 7 is no different than iOS 6 but it was all I needed to keep my iPad new and fresh.

  • https://twitter.com/MrElectrifyer MrElectrifyer

    Kinda misleading, this is only referring to the Surface RT (the Microsoft branded iPad), not the Pro (a full fledged PC in tablet form). The Pro has been selling well, hence why they never reduced the price.

  • mehrab

    Aw i actually kinda feel bad for them :s

  • Raashid

    Click bait article, as always. This is only referring to the failure of Surface RT, an ARM tablet. Doesn’t include the Surface Pro, an Intel Ultrabook in tablet form.