Surface: Microsoft, What the Hell is Wrong With You?

Surface: Microsoft, What the Hell is Wrong With You?

Summary: Microsoft's new tablet not only fragments the Windows 8 mobile ecosystem, but also creates strife with its OEMs and will re-ignite negative perceptions of the company's former monopolist position.


Maybe I'm just cranky because I had to work a 12-hour day, waiting for an event to finish on West Coast time when I really just wanted to take my wife out to dinner instead. But Microsoft's new Surface tablet still has catastrophe written all over it.

Let's forget the ridiculous build-up to the event that was completely unnecessary and get right to the meat of things, shall we?

The Surface tablets in and of themselves look like nice devices. Beautiful construction, decent specs. But absolutely nothing was said about price or availability. Only that the Windows RT/ARM version will ship around the Windows 8 retail release timeframe (October) and the Pro/Intel version will ship 3 months after that.

To quote Microsoft, "suggested retail pricing will be announced closer to availability and is expected to be competitive with a comparable ARM tablet or Intel Ultrabook-class PC. OEMs will have cost and feature parity on Windows 8 and Windows RT."

So let me get this straight, Microsoft. You made journalists schlep across the country, no, the planet, for a product that might not ship for months? You're lucky they didn't burn the venue down.

Okay, no ship date, no prices and... no compelling 3rd-party applications or even Office to show on it whatsoever. So we have no idea how well it performs, and how well supported it will be by 3rd-party software developers. No partnerships to speak of. Nada.

No demonstration or even any claims of how good the battery life on each model is.

Nothing to say whatsoever about the nature of what display technology they are using, whether it is OLED or LED/LCD backlight or something else. Great, so one is a 720p and the other is a 1080p. Details, please.

Gee, that doesn't exactly make folks want to stop in their tracks from buying iPad 3s, does it?

Also Read:

Okay. Back to the the dual-architectures thing. They decided to launch a tablet product with their own brand, but bifurcate the message? Which one are we really supposed to buy, then? ARM for consumers? x86 for prosumers and enterprises?

And oh yeah. That niggling little OEM thing.

Does that mean that a "Surface" branded Microsoft tablet is bloatware free? Why should we as consumers buy an OEM device now, if the Microsoft is going to be the "Pure" Windows 8 experience, a la Google's Nexus, and will be "price competitive" with the OEMs?

And if the Pro version of the Surface is powerful enough, with Intel Core i5 Ivy Bridge CPUs, why do we need Ultrabooks if we can just clamp a keyboard cover to a Surface Pro?

Am I the only person who beleives this thing is a total jump the shark cluster-you-know-what for Microsoft?

Right now, Microsoft's OEMs -- with the exception of whatever "lucky" company got the nod to do the contract manufacturing for this product -- must be absolutely livid. To produce their own ARM and x86 Windows 8 systems, they have to pay exorbitant licensing fees.

Windows RT is going to cost an estimated $85 per copy to your average OEM. A Windows 8 Professional license on x86 will be considerably more.

I don't care what the hell Microsoft says about partners having cost and feature parity, that's $85 of pure margin advantage that Microsoft has and the OEM doesn't.

Since Microsoft now produces its own hardware, that $85-$150 per copy the OEM would otherwise have to pay is pure profit which gives them an unfair advantage.

And wait until we start seeing the BOMs for Surface added up by companies like iFixit and IHS iSuppli and see how much cheaper Microsoft can go than the OEMs with their own competing Windows 8 tablets when directly manipulating the supply and ODM chain as well.

What are the OEMs supposed to do? Well I suspect that if you are someone like a Lenovo or a Hewlett-Packard, you probably are seriously going to re-think whether or not you really want to produce tablets with similar specs to the Surface RT and Surface Pro.

You now have to out-value the Surface devices, or you have to play the Enterprise game with beefier, more expensive Windows 8 convertible tablets with higher-res screens and faster CPUs and SSDs that nobody other than select Fortune 500 firms may want to buy, because they'd rather do business with a hardware partner they already buy systems from.

The Ultrabook concept may no longer be sexy to the majority of its target market anymore. Intel can't be particularly crazy about that.

And the Asus and Acers of the world? How are they going to compete on margins with this thing, unless they are being chosen as the actual contract manufacturers? Something tells me that the bulk of the contract biz on the Surface is going to end up with Foxconn, Quanta and Samsung, not these folks.

Personally, if I was Steve Ballmer and the bigwigs at Microsoft, I would have done it a bit differently.

"Surface" as a brand name actually is pretty good. It sounds futuristic and new. So why just not make "Surface Tablet" the brand name for all convertible Windows 8 tablets? Or have Surface replace "Windows" as the name of the OS going forward? Or "Windows Surface" even?

Why not give the OEMs access to the manufacturing technology for the special "VaporMG" casings and the keyboard cover? Why create such a potentially hostile situation by biting the hand of the companies that license your software which is currently your bread and butter income stream?

What, you really want them to start pushing Ubuntu and Android and other Post-PC solutions for real Because now you just asked them to.

All of this reeks of suicidal thinking from a company that wants to deep six its long-established manufacturer ecosystem.

It does not reflect the actions of a company that tried so hard to shed long-held industry perceptions of being a monopolist, and worst case, it could potentially re-ignite federal antitrust activity that Microsoft has spent more than ten years digging itself out of.

Yeah, I'm cranky. But I'm not crazy.

Will Surface result in untenable, stressed relationships with Microsoft's traditional OEM partners and Intel, and a renewal of its status as industry monopolist? Talk Back and Let Me Know.

See also:

Topics: Windows, Hardware, Microsoft, Mobility, Tablets


Jason Perlow, Sr. Technology Editor at ZDNet, is a technologist with over two decades of experience integrating large heterogeneous multi-vendor computing environments in Fortune 500 companies. Jason is currently a Partner Technology Strategist with Microsoft Corp. His expressed views do not necessarily represent those of his employer.

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  • Your first sentence...

    ...sums it up.

    Love it or hate it this is a move Microsoft absolutely had to make. The firm is dead in the water when it comes to mobile. It's do or die for them right now. They absolutely have to be in mobile. Obviously they won't touch Apple but the tablet market is brand new and Apple is the only truly established player.

    Even if this tablet kinda sucks, it still at least looks 1000x better than anything Redmond has put out to date. It's a bold move that is years overdue.

    Don't get me wrong. I'm rooting for Android to finally come to tablets in a meaningful way. But I think Microsoft just put Google on notice. That little robot better come out swinging hard at Google I/O later this month.
    • Yep, the missing piece was for MS to produce hardware;-)

      MS is dying in the tablet and mobile space, but is it because of hardware?

      I don't think so, MS software offerings have been terrible. Today's announcement doesn't address that problem, but announces MS will solve some imaginary hardware limitations by producing their own.

      Ballmer is delusional; and he's killing that company.

      If this latest decision doesn't get OEMs looking at alternatives, in particular knocking on Google's Android's offices I'd be shocked.

      Touch and Metro for desktops were the biggest mistakes leading up to Win8 release. MS today has topped those.
      Richard Flude
      • Android?

        But Google have been doing exactly the same thing, at least in the phone arena, since day 1.

        By your standard, Sergey and Larry are delusional; and they are killing that company... Oh, wait, it turned Android into a success.
      • Their fate in their own hands....

        Not the OEMs. That's what I am taking from this. It's either let the OEMs murk-up the market with junk or take matters in your own hands. Oh and by the way set a standard for Windows Tablets while you're at it for OEMs to follow.

        Remember in 2010 when Ballmer and HP was touting the HP Slate as an iPad competitor? What a big joke that was. This tablet market is too important for Microsoft to hand over to partners to kill. Not saying what they released will succeed either, just that they couldn't afford to hand it over to the OEMs any longer.
      • Perhaps, this is Plan B

        Microsoft didn't see anything at Computex, two weeks ago, to have any faith in the stalwarts of the PC era. dave95's got it right.

        Alan Kay said, "People who are really serious about software should make their own hardware." Maybe Microsoft is finally getting serious about their software. It's worked for Apple.
      • I'll go with you as the delusional one on this

        You are really working overtime on this, and have used 6 to 7 different spin tactics already.

        So unlike you, or anyone, who isn't desparate about something. ;)
        William Farrel
      • @wright_is

        Actually Google got some of the same criticisms for releasing its own hardware platform but there are two major differences here. Google has no price advantage since Android is free to the OEMs and not sold to them and Google sort of backed away from the hardware market. They never really produced many of their own phones to compete with the other vendors or perhaps their phones just didn't compete as well. Either way they at least competed on a fair playing field.
    • I think this puts pressure on Google

      to come out with their own tablet now. Because let's face it, OEMs are destroying Windows and Android. Death by a thousand little needles.
      The one and only, Cylon Centurion
      • This event was clearly meant to steal Google's thunder.

        The odds of a Nexus Tablet announcement at Google I/O next week were basically 100%. Microsoft gets to scoop them, but in response 1expect Google to announce [b]loudly[/b] a specific ship date.
      • Why would Google care?

        It's not as though they have to worry yet, or if at all. It's not as though they're ever going to be allowed to put Microsoft's apps on Android kit.

        It's not even remotely clear how many are going to be churned out by whomsoever is making the Microsoft kit and how much they're going to suck out of your wallet.

        Besides, if you're a googler it'd probably be time to grab a pint of something, sit down and watch the show. There's not a lot else they can do now is there?
      • Good for Google

        Looks like Linux and Android may be the benefactors of MS moves. Hardware manufacturers can get an 85$ advantage by dropping MS tablet software and moving to Android or Linux. No doubt this is now being contemplated by all the tablet makers
      • ego.sum.stig....suck out of your wallet?

        Is the money sucked from your wallet for overpriced Android devices somehow less irritating or what is your point?
        The strategy is for MS to lead the way and back off later with the OEMs building all future tablets.
        Have you priced an Andriod tablet that doesn't totally suck? They are way over priced for the "bloatware" ridden piece of electronics you get and in no way compete with Apple in the least in terms of elegance and value.
        This will.
      • Mr. Spock. We have heard from Acer.

        Acer claims MS is leading the charge with MS branded tablets to start the ball rolling but plan to back off and allow the OEMs to build all future tablets.
        Acer CEO has stated that MS has NO intentions of building their own hardware in the long term.
        You have not heard from the OEMs for this reason, they have reassurrance that MS is not going to continue to be their competitor. Only uniformed bloggers who like to bash MSFT for everything, even if it mirrors what Google has done in the past, which they praised at that time, find it necessary to write chicken little stories about MSFT.
        Hypocrite is not a strong enough word for all ABM talking heads that write nothing but "This is the end of MS" and have for years and have been wrong every time, obviously. They are nothing more than pushing their own agendas and it's sickening. They want to see MSFT fail and they feel their uninformed blogs that attempt to make MS look bad is their sworn duty.

        Then they blame it on being cranky because they missed a dinner. If I complained every time I've missed dinner due to work I would be complaining multiple times every week, and I'm not. It's part of the job, but I guess being a blogger is supposed to be a cushy affair with many nights on the town for dinner and plush offices with a comfy leather couch for naps.
      • @xunil_z

        Please feel free to stop. Pause. Reboot your brain and try and think.

        The Acer chappy's statements are hopeful at best, as he can only be guessing as Microsoft made the point of confirming they didn't tell the OEM's one teeny weeny thing about this move.

        Pray tell, inform the world + dog about the price of Microsoft's slabs. Also, for jollies, include (before and if they announce one) Google's pricing. If you can't, please feel free to go away.
    • Agreed...

      I don't this wasn't a "concerted" move. I think OEMs were told beforehand that Microsoft had tablet design of their own and they were invited to push Windows 8 thru other "channels".

      Also you forget one key fact. There's a "gap" between the two offerings... one's Windows RT (lower spectrum) and the other one's Windows 8 Pro... no Windows 8 devices were mentioned. They said the Win RT was ARM tablet range (aka $600-$900) and the Windows 8 Pro was ultrabook range (aka $1200-$1500). That means that there's plenty of room in between for simpler Intel based systems, including Atom Medfield designs with Windows 8.

      Last but not least, this are "trendsetter devices" targeted straightly against Apple (Microsoft has this thing against Apple, that they even had a funeral for iPhone and BlackBerry during Windows Phone 7 launch). I guess they figured if they didn't create a product aimed precisely at iPad using Windows RT, the OEM would release so-so products just as they did with Android, which rather than help the OS will just make it a laughing stock.
      • Agreed....

        All they have to do was look to Android and Android OEMs for reasons why they needed to release their own, instead of letting the OEMs release junk. These same OEMs currently releasing expensive junk for Android will be the ones building and releasing WinRT tablets.

        And the traditional PC OEM (HP, Dell) still haven't a clue what consumers are looking for.

        Again not to say Microsoft does and their tablets will succeed, just that I can't fault them for putting their future in their own hands.
      • A really good point ...

        Windows RT is clearly meant to be an "iPad Killer" and at 32GB and 64GB it is competing against the $600 iPad and the $700 iPad. Know off $50 each and you have a really good iPad competitor.

        Microsoft doesn't REALLY want enterprise customers to buy Windows RT because those folks still need a full-fledged laptop replacement instead of an auxilliary device - as the iPad is - the the Windows RT device would be.

        They can let their x86 OEMs deliver the high-end stuff.
        M Wagner
      • While I like it...

        Still struggling to see surface as an iPad killer. If it's starting at $600-700, it's still well above the iPad 2 and the entry level new iPad. Sure, it matches up with the higher end models, but the entry level models are where Apple's making their volume.

        If anything, this is going after the marketshare that currently sits vacant because there are still many holding out for a true competitor to appear. The Fire has consumed some of this market but seems to be losing steam after getting out of the gate fast, and the Android OEMs, despite what Moto and Samsung would like you to believe, are still trying desperately to figure out tablets.

        Apple still needs to be on guard, though. This could start a 2nd wave of enterprise adoption by companies that have either been hesitant to embrace BYOD or simply haven't embraced tablets because Windows is what they know and are comfortable with.
      • Ballmer has killed Microsoft...

        Lol at $600 to $900 the low range windows tablets are dead before arrival. In the market created today Android has made the market to where you need to be solid at the $399 to $500 price range with great specs. Non apple sheeple would not pay what the apple buying fools do for a tablet makes absolutly no sense at all so that said if the arm tablet is above $399 then it will not matter as the entire line is dead. To make waves you need a realsitic price with the basic options of today. To put yourself in the apple price range you obviously just wasted time. i am a microsoft fan but I see Balmmer destroying Microsoft at break neck speeds. The Kin fail..Zune a superior product to ipod but no marketing what so ever phone 7 8 with metro fail.....Now if they release tablets that are gonna be $600 at low and $1000 at high points we can predict fail again..To bad they were a great company that will now be gone.
        • Ballmer etc.

          I get the impression of a loud pushy type that's unwilling to listen to anyone. There's no thoughtfulness or contemplation only an overbearing my way or the highway attitude. He should take a five year vacation and if Microsoft comes back to the top, he should simply extend it indefinitely.