When Microsoft out of the blue announced on Monday it was entering the tablet race with its own Surface-branded product, many industry watchers and, more importantly, Microsoft’s hardware partners were taken aback and left scratching their head.
Just what the hell Redmond thinks it’s doing, many OEMs now wonder. Aggressive pricing (think $199 or below) is seen as key to Surface’s chance of success and OEMs can’t exactly compete with Microsoft on level ground because their already thin margins are stretched even thinner as they pay license fees to Microsoft to use Windows on tablets.
But Microsoft may not be in it for the money or hardware sales, warns Acer founder Stan Shih who has commented that the Surface is just a ploy to drum up excitement and drive Windows 8 adoption…
According to DigiTimes:
Microsoft hopes that marketing its own-brand tablet PCs will encourage vendors to offer Windows 8 tablet PCs and thereby help expand market demand for the product line, Shih analyzed.
So is Microsoft pulling a Zune with the Surface? Kinda, Shih says:
Once the purpose is realized, Microsoft will not offer more models, Shih said. Vendors adopting Windows 8 should interpret Microsoft’s intentions positively, as they will benefit from Microsoft’s marketing, Shih indicated.
This makes a lot of sense to me.
Windows 8 is a major release that has the potential to alter the computing landscape substantially.
For that to happen, Redmond must prove that the software, based on the Windows NT kernel, can run smoothly on the tiniest smartphone screens (we’ll see about that later today) to tablets to desktops.
Therefore, the company would shoot itself in the foot by letting OEMs create sub-par Windows 8 experiences on tablets by compromising on features in order to trim down costs.
On the downside, OEMs have bigger fish to fry as Google already stepped on some toes with its control of handset maker Motorola Mobility. Moreover, the search giant is rumored to launch its own Nexus-branded tablet running Android later this month.
The Surface is Microsoft’s first-ever foray into the business of making personal computers. As in, the Pro version of the tablet runs legacy Windows software as well as shiny new Metro apps.
Mind you, it ain’t like Microsoft is new to hardware. They’ve been creating mice and keyboards for ages and their Xbox is killing it in the console market.
But it would be foolish to risk their higher-margin Windows and Office licensing business in the long run by supporting its own low-margin tablet product and antagonize its licensees in the process.
Some alienating has already occurred due to Microsoft not telling its PC partners about the Surface until three days before the presser, Reuters notes.
Windows chief Steven Sinofsky made a round of telephone calls but gave only the barest details on Friday, neither revealing the name of the gadget nor its specifications, two people close to Microsoft’s partners told Reuters.
As such, Microsoft’s main partners remained “in wait-and-see” mode and had to monitor the news for details, one of the sources said.
Depending on who you ask, the Surface is not seen as a big hurt on the iPad. According to IDC, the iPad will account for 63 percent of all tablets shipped in 2012.
What’s your take?
Is the Surface just a showcase for OEMs to lure them into adopting Windows 8 for their desktop and mobile products at the expense of Google’s Android (because Apple is in its own league)?