Microsoft Surface RT & Pro estimated to have sold 1.5M units total - Page 2

"I like our strategy, I like it a lot". Priceless! 

Omg! Are you sure that's right! 1.5 million sold, I'm truly astounded by that number. It seems Incredible to me that they actually sold that many. They must not be including the returned in their numbers. After having using it for 1 weekend I took it back. So I guess the number should read 1,499,999 sold.

"Surface", Microsoft's hobby.

Anybody who couldn't see from a mile away that this ridiculous Surface thingy was going to flop is incapable of objective and rational thought. It's the same story over and over again. Some new device gets announced, will this finally be the iPad killer? The media hypes it, various clueless people fawn over it and compare it to the iPad, while certain rational people on this forum declares it to be DOA. And how does the story end each and every time?

 

The same people who fell for this Surface tablet and the people who hyped it up will be the same people who will be hyping the next "iPad Killer" when that comes along. And just like now, they'll be just as wrong and just as clueless next time also. A half tablet, that is worse than a tablet and a half laptop that is worse than a laptop is a good idea? And it comes with a kickstand and runs Windows? Are you kidding me?  GTFOH.

yes the RT was obviously DOA from day 1. the Zune all over again. maybe there were a million hard-core MS fans that bought one, but that's it. if they want to sell the rest they will have to do a price-slash dump like HP did. it has no future. only question is how long MS will pretend it does before pulling the plug.

 

and the Pro ... Gates has been trying to shove "full" Windows onto a tablet for 10 years. is this try #4? it will never work. handheld products are fundamentally different - where simple is best, and Windows will never ever be simple. i bet all 400k were sold to MS IT geeks, and so that's about the end of that too. but as long as Gates is pulling strings at MS, they will never give up trying to jam it anyway. he'll dump his BFF Ballmer if he has to, but he'll never let go of the "Windows Everywhere" fantasy.

 

train wreck.

Apple has a hobby project. MS has a hobbled project.

Dead in the water. 

 

Next. 

In other words, a complete failure.

1.1 million RT units over almost 6 months? Roughly 200k per month, vs nearly 8 million iPad a month.

Yes, even the word "flop" would be a gross understatement.

That shows in our local major shopping mall. MS had a hallway booth  there for several weeks after the Surface release, within sight of a Samsung store in the middle of the mall.

Then the MS Surface booth disappeared,  for several weeks.  Now I see it's back, but not nearly as busy as before.

Seems possible customers have lost Surface interest.

 

As for a 7" Surface, no way as far as I'm concerned. 

For serious web browsing and other computer like uses, IMO 10" is the sweet spot.

For book reading  I prefer 7".

 

When your product's only saving grace is "At least it did better than the Kin"…

With barely any sold and with more than million unsold of a very low goal it appears MS took a page from the RiM Playbook.

Surprisingly good numbers for MS if true.  I was expecting 1/3 of that number at best.  I'd certainly put the Surface ahead of any Android tablet out there, not that that's saying much.

Lol!!

Only way Micro stupid will be relevant is to keep Ballmer then do everything the opposite of what he says. How does someone so obviously dumb get in charge?

"Company representatives have revealed previously that the company will keep trying to market the tablets until they find a winning strategy."

This is, and has been for a while, Microsoft's strategy...

With the surface, Microsoft re-invented the wheel.

 

And they made it square.

I have no love for MS, but maybe Apple can help them out as both have a common enemy in google,
Maybe let them see some iOS code accidentally.

On a more serious note, if samdung sticks with google then perhaps Apple could team up with HTC, who have made peace with Apple and make good quality phones. They lack the marketing clout of samdung, perhaps Apple could do something in that space. A silly thought but interesting.

Nice one lol!

Let's do it a different way. 1.1 M RT units at an average price of $500 is $550 M. Add in 400,00 Pro units at $1000 and you're at a total revenue for the two products of around $1 B.

Average PC net income is around 2%, so even if they made the average margin (which is extremely unlikely for a startup market), they made $20 M. Gross margins are around 20% in that industry, so they had gross margin of $200 M (again, assuming that they had no startup costs and were just as efficient as other PC makers right out of the box).

Now, think about the marketing expense. One report says that the Windows 8 marketing budget was $1 B. (http://www.informationweek.com/byte/personal-tech/tablets/for-microsoft-surface-modest-sales-are-g/240144101) I have no idea how much of that was due to Surface, but based on the TV advertising I've seen, it was a pretty high percentage. But even if you assume that it's only 20%, their advertising budget wiped out the entire gross margin for the product (even making the most favorable assumptions). And one report suggests that the budget will actually be closer to $2 B (http://news.softpedia.com/news/Microsoft-to-Spend-More-than-1-Billion-773M-on-Windows-8-Advertising-Campaign-298955.shtml).

In the end, it was a bad strategy. PC sales are down. Microsoft has no PC manufacturing experience. They have no distribution except online and the tiny number of Microsoft stores and kiosks. Since this is absolutely the kind of product that people want to see in person before buying, failure to get it into Best Buy, Staples, Walmart, etc is a fatal mistake. And turning all of your loyal PC OEMs into enemies is an equally big mistake. Of course, I've been saying this all along, but Microsoft still suffers from the delusion that people love them and their products and has no concept of how the world really works.

Another "Zune" - adios amigo ...

1.5M tablets isn't much but it is $1B revenue for MS where before it was zero.
And while I think Win8 is stupid I have to admit that MS didn't come up just with another iOS copy!

 

 

When a company captures for many years more than 90% of a market, the management tends to think it is invincible, and this is the beginning of the end. There are many examples ...

 

The illusion of invincibility also extends to some outside observers ....

Edited by umrk_lab - 3/16/13 at 8:06am

This article is a little misleading.

I learned Basic and Machine languages on the Apple IIc. I have nothing but respect for Apple. BUT, this article is a little misleading. ELO and Planar first developed their touch screen technologies for POS equipment in the early 1990s. The programs that interfaced the technology was programmed to work with Windows 95, and later. Apple was not the first operating system to use touch screen technology, though they were the first to utilize it for consumer use. It wasn't Microsoft that missed the mark on this, it was Planar and ELO.

Though Apple helped pioneer the consumer computer industry, they never really boomed until the movie Pirates of Silicone Valley came out, and showed what kind of person Bill Gates really was. If Bill Gates wasn't such a ......., Apple may not have never boomed. So, you can thank Bill Gates for making Apple into what it is today. Tablets were attempted in the past, but the consumers rejected them.

The biggest reason that the Surface tablet will never compete with the Ipad is due to bad business practice by Microsoft. They will not offer Windows 7 on the Surface tablet, pretty much trying to force a new operating system down consumers throats. Not only would you have to learn a new product, but a new operating system at the same time. This is too much change for some people and Microsoft has drastically narrowed their target audience by not offering Windows 7 on the Surface, or at least a dual boot system where people can learn the new OS at their own pace.

It took a while for Linux to catch on, also. Most people that learned Linux operating systems were utilizing another OS at the same time. Microsoft should have learned from this model also.

The best thing about OS X is that the changes that are made, as it progresses, are subtle. Apple isn't so arrogant to just totally make a new GUI and force it down throats.

 

I'd say the movie didn't have any sort of effect there.

 

Indeed! Exactly. And the difference between them is more fundamental than that. Where Windows has always been about forcing THEIR way on the user, Apple builds their products with physical reference in mind. 

That's why I'm not at all against skeuomorphism and quite against those that say there should be NO skeuomorphism. Where Microsoft can (try to) change Windows' UI and UX UTTERLY, forcing the user to completely relearn THEIR way, Apple builds their computer hardware as simply and unobtrusively as possible, removing it from the experience. Their software, then, mirrors physical equivalents of the purpose of the application. Notes looks like a legal pad. Reminders looks like a black book. Calendar looks like a desk calendar. This is stuff with which people are familiar, not single-colored squares. Not single-color backgrounds. 

That's a baseless conclusion. How many people saw the movie? I didn't. That movie came out in 1999. Apple started to prosper with the iPod and continued to do so when it was made available for Windows users. The perception of Gates had little to no effect on Apple's success.

Guess the number of people that needed to do 'real' computing was overly exaggerated.

Revenues don't do you any good - if you're losing money on each sale. See the analysis above.

More importantly, there's the issue of opportunity cost. For example, Microsoft developed Windows 8 to run on tablets (both RT and Pro). This came to fruition just as many users were starting to get frustrated with Android - particularly the fragmentation, but also license issues, etc.

What if Microsoft had stuck with their traditional plan and licensed Windows 8 to OEMs? It would have done the following:

1. The product would be more widely distributed. People could buy the product at Best Buy, Walmart, etc.
2. There would be a variety of products available, increasing consumer acceptance.
3. The OEMs would already have extensive PC manufacturing experience which might lead to a lower price point.
4. The OEMs would probably have been eager to have the product. Dell, HP, Lenovo, Toshiba, etc don't really have anything to compete with tablets - and this would have given them something.

Before labeling the $1 B in revenue a success, you need to ask:
1. Did it add any profits?
2. Did it add long term value beyond the profits (if any) generated?
3. Would the alternative have been even more successful and/or had lower risk.

My own assessment is that the answers are:
1. No
2. Probably - if it helps with selling Windows 8 desktops
3. Absolutely yes.

ah yes, deja vu all over again! for fun, take a look at this 2007 article:

 

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aKNQROlvcaOM

 

see, just re-boot the marketing!

 

so reportedly MS sold 1.2 million Zunes in its first 8 months on the market @ 150K per month. whereas the RT has shipped (but sales?) a reported 1.1 million in only 5 months @ 220K per month. why, that's 50% better than Zune!

 

i like their strategy, i like it a lot.

 

TV in 1941! Wow. The BBC launched the world's first regular television service from Alexandra Palace on 2nd November 1936