Surface versus iPad: A tale of two tablets?

Microsoft's Surface sales revenue has surged, while Apple's iPad sales slide: what does this say about the state of the PC market?

It's a neat juxtaposition for sure: earlier in the week Apple's fourth-quarter 2014 results showed that iPad sales sliding: 12.3 million sold, down from 14.1 million from the same period a year ago and in $5.3bn in revenue, down from $6.2bn — a decline of 13 and 14 percent respectively year-on-year.

And then, a few days later Microsoft's first-quarter 2015 results (which actually cover roughly the same period) told a slightly different story. Revenue for its Microsoft's Surface 'tablet PC' more than doubled over the same quarter a year ago, hitting $908m, which the company said was driven by students, professionals and enterprises.

Microsoft CFO Amy Hood said that the new Surface Pro 3 sales were "pacing at twice the rate of what we saw with Pro 2" and that gross margin for Surface "was positive" as businesses replaced tablets and laptops with the hybrid device.  

Add to this the unexpected resurgence of the PC market (in the US and Europe PC shipments are up year on year according to Gartner ) and the increasing evidence that tablets are being squeezed between phablets and hybrid devices , and you have a very different scenario to the one a year or two back, when it looked like tablets were running rampant and the PC was doomed.

In reality, of course, it's a little bit more complicated than that: Microsoft may have come up with a compelling product with the third generation of its Surface Pro, but it's still growing from a very small base and it's not clear how profitable (if at all) the device is. And despite the rise in revenue it's also not clear what Surface unit shipments are doing - much of the rise in revenue may be down the higher cost of the Surface Pro 3 over previous generations of the device rather than higher unit sales.

Meanwhile, Apple CEO Tim Cook points to the 237 million iPads the company has sold over the last four years and describes the drop in iPad sales as "a speed bump". His argument is that there's still plenty of growth left for the tablet — especially in the enterprise, where Apple's alliance with IBM could be a significant factor.

What these numbers really represent is a snapshot of a turbulent device market. When the iPad arrived (and the other tablets that followed), it shook up the PC market so much that it's only now recovering some sort of equilibrium.

The disruption caused by tablets has been painful for some but also very positive — the PC world was dull and had been lacking in innovation for far too long. The emergence of hybrid devices like the Surface and Lenovo's Yoga range shows that manufacturers are thinking much harder about how their devices will be used, which can only be a good thing for customers.

As such, there's room for tablets, ultrabooks, hybrids and everything else in between: rather than focus on narrow battles between particular types of devices, we should celebrate the variety we now enjoy.

ZDNet's Monday Morning Opener is our opening salvo for the week in tech. As a global site, this editorial publishes on Monday at 8am AEST in Sydney, Australia, which is 6pm Eastern Time on Sunday in the US. It is written by a member of ZDNet's global editorial board, which is comprised of our lead editors across Asia, Australia, Europe, and the US.

Previously on Monday Morning Opener

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