Microsoft Surface just a ploy to sell Windows 8, says Acer founder

Posted:
in General Discussion edited January 2014
Acer founder Stan Shih on Wednesday referred to Microsoft's recently-announced Surface tablet as merely a tool to boost adoption of Windows 8, saying that the Redmond-based company has no real intention to enter the hardware game.

Microsoft's surprising foray into the iPad-dominated tablet market is getting a less than cordial reception from third-party OEMs using Android and Windows alike, and some company heads see the Surface brand as being a dubious entry at best. In essence, what Microsoft has created is a halo device to attract users to the Windows 8 platform that the acer founder believes will be abandoned after the first models roll out later this year.

Shih told DigiTimes he believes Microsoft is unlikely to take a real stab at competing with Android and the iPad because the costs related to hardware manufacture yield far less profit than the company's tried-and-true software licensing business model.

Among the many difficulties that Microsoft would encounter in building and marketing its own tablet are production management, distribution, and after-sales maintenance service, Shih said. The Windows maker has strong track records in all those categories, though rolling out a piece of hardware is quite different than boxed software and small peripherals.

By drumming up demand for Windows 8 tablets, Microsoft hopes vendors will expand the stock of devices made by other companies like Lenovo, Samsung and Acer instead of Android models made by those companies. Shih said that vendors should take a positive view of Microsoft's plan as it can be seen as essentially free advertising.

Surface
Microsoft looks to push Windows 8 with its Surface tablet. | Source: Microsoft


Surface was officially announced by Steve Ballmer on Monday at a last-minute special event in Los Angeles. There will be two different iterations of the device, an ARM-powered model running a stripped-down version of Windows 8 called Windows RT and an Intel i5-carrying version which will run a tablet-centric full-fledged Windows 8 OS called Windows 8 Pro. The Windows RT model is set to go on sale in conjunction with the launch of Windows 8 this fall to be followed by its larger, and presumably more expensive, brother three months later.

Microsoft reportedly gave PC manufacturers a heads-up before unveiling the device, and when asked by All Things D about how those companies felt about it, Ballmer replied with "no comment."
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Comments

  • Reply 1 of 82
    solipsismxsolipsismx Posts: 19,566member
    I agree with this wholeheartedly. MS doesn't want to sell the complete widget they simply want Windows to be dominate so they can get OEMs to suckle their teat. Unfortunately since Windows has no real smartphone, tablet or ARM-based presence they are not just losing out but the gravitational forces of those three categories have stagnated and will shrink the WinPC market if they don't think of a way to fill the void with Windows.

    Perhaps not the best plan, just like when they screwed over their Play4Sure OEMs when they created the Zune, but it's a plan and it's either case MS is trying to make a move into the HW side long after the dominos have fallen. I quite like many aspects I saw with the Surface itself but there are so many questions and concerns about the way it was shown, what wasn't shown, the lack of hands on, the time frame to release, price questions, etc. that it's looking as dead as the Zune, which was a very solid device by version 2.0. Too little too late.
  • Reply 2 of 82
    quadra 610quadra 610 Posts: 6,756member


    MS has around 30 years of learning to do before they can do the vertically-integrated "sell the whole widget" game without looking like amateurs. 


     


    The problem is that MS doesn't think like Apple. The two companies are approaching tech, philosophically and strategically, from entirely different places. You can't just transplant Apple's CULTURE into Redmond and expect it to function successfully. 


     


    Just look at the disastrous Surface keynote. It was just so . . . awkward and flat-footed. Sinofsky looked so uncomfortable that he was practically squirming. Again, these guys aren't accustomed to this sort of thing. Microsoft is broken at the tech-cultural level. They're no Apple, but they're trying desperately to be Apple, without having any grounding in the basics. 

  • Reply 3 of 82
    solipsismxsolipsismx Posts: 19,566member
    quadra 610 wrote: »
    MS has around 30 years of learning to do before they can do the vertically-integrated "sell the whole widget" game without looking like amateurs.

    When did Apple decide to take Mac OS X, strip down to it's bare essentials and then build it back up? We know the iPhone came out in 2007 so that's at least 3 years before the iPad came out and I'm under the impression it was at least 3 years before that. Even before that Mac OS X was built using PPC and x86 and had already transitioned Mac OS from Moto to PPC.

    I suppose we can say MS has experience with PPC from porting Windows to create the Xbox but I doubt they put in the same effort or had the same constraints since it's the same essential HW and much more powerful than a PC, phone or tablet.

    I commend MS for actually porting WinNT to their smartphone and eschewing WinCE in the process, and getting a single OS across ARM and x86, but it all seems rushed and without a proper cross development kit it seems like it's all going to backfire. Maybe they do have one that can build cross platform apps as easily as Apple's SDK allows, or easier, but I certainly haven't read about it and certainly didn't see it demoed yesterday in their very long and bored 2 hour video on Win8.
  • Reply 4 of 82
    constable odoconstable odo Posts: 1,041member


    Of course, it's a ploy to sell Windows 8.  What else is Microsoft in business for but to sell Windows?  Windows 8 by itself may not help Microsoft sell a lot of copies.  A Windows tablet ups the ante a bit and may boost interest in Window upgrades.  I only hope that as a Apple shareholder that the Surface tablets have a happy Zune ending.  I'm already tired of hearing how the Surface tablets are going to put a dent into iPad sales.  Seriously, not one Surface tablet has been sold yet, so it's far too early to tell what consumers think of it and if they'll shell out their hard-earned cash for it.  I say they won't, but maybe that's just wishful thinking on my part.

  • Reply 5 of 82
    indiekidukindiekiduk Posts: 358member

    Quote:


    The Windows maker has strong track records in all those categories, though rolling out a piece of hardware is quite different than boxed software and small peripherals.



     


     


    sounds like Shih forgot about the Xbox

  • Reply 6 of 82
    djmikeodjmikeo Posts: 179member


    If this is true, it will backfire on Microsoft. They are showing a prototype that isn't practical, will not be able to be reasonably priced due to economies of scale and is nothing more than a Halo device that other manufactures won't be able to duplicate at a reasonable price. 


     


    It's not practical because it will likely have poor battery life, it can't be used as a laptop, just look at the side profile photo and try to imagine using that on your lap. If they aren't going to keep it in production, they will never build enough to bring the costs down and consumers will at first be excited by this announcement, only to be disappointed when it is finally released. Lastly, Microsoft does't need to yank another product off of the market soon after it is released. Those early adapters will be pretty upset and the bad press is going to hurt the Windows Tablet sales.

  • Reply 7 of 82
    aaarrrggghaaarrrgggh Posts: 1,608member
    There is a good write-up on Apple 2.0 about why people think the effort is real. Bottom line: MS makes $78 operating profit per PC, Apple makes $178 per iPad. If PC growth stagnates, MS will see more pressure on their share. Taking profit from Apple won't work; the only rock they can squeeze is their OEM partners.

    That said, I seriously doubt MS themselves know if it is a marketing ploy or a serious change in direction. I am sure it is both until one direction proves to be a failure. They have done a pretty good job promoting Windows 8 this week for sure, without really providing more than a concept for the Surface.

    Looking at best return on investment, I would say that marginalizing the OEMs is more productive for MS, assuming they can sell themselves as a premium brand. They have to make a decision though, and it would seem like that decision needs to come fairly soon or they risk pushing critical players towards alternatives.
  • Reply 8 of 82
    dickprinterdickprinter Posts: 1,060member

    Quote:

    Originally Posted by SolipsismX View Post



    I agree with this wholeheartedly. MS doesn't want to sell the complete widget they simply want Windows to be dominate so they can get OEMs to suckle their teat. Unfortunately since Windows has no real smartphone, tablet or ARM-based presence they are not just losing out but the gravitational forces of those three categories have stagnated and will shrink the WinPC market if they don't think of a way to fill the void with Windows.

    Perhaps not the best plan, just like when they screwed over their Play4Sure OEMs when they created the Zune, but it's a plan and it's either case MS is trying to make a move into the HW side long after the dominos have fallen. I quite like many aspects I saw with the Surface itself but there are so many questions and concerns about the way it was shown, what wasn't shown, the lack of hands on, the time frame to release, price questions, etc. that it's looking as dead as the Zune, which was a very solid device by version 2.0. Too little too late.


    Wait a minute. Didn't Ballmer say that Microsoft now wants to take another stab at the vertical business model like Apple XBox? To better integrate, and create synergy between, HW & SW? What this guy Shih is saying completely contradicts that. So are these simply demonstrative models to show the 3rd party OEM's how it's done and then the plan is to later pass the baton to them? There's a lot of fuzz surrounding this whole thing, including the seemingly intentional omission (possibly due to cost) of cellular connectivity. Either Microsoft is completely desperate or they think they hold the key to the Holy Grail. I feel it's the former.


     


     


    On another topic...I've been too busy to look for and watch the whole Surface unveiling thing but have the device freeze-ups during the NetFlix app segment been edited out from the posted video? I know Apple has had a few faux pas during keynotes also but do they edit them out before posting the video for public viewing? Apple's have never been that bad so I've never really looked for them while watching. One that comes to mind is lack of bandwidth due to attendees hogging the WIFI. Not exactly a device problem but a slightly embarrassing incident, one that Steve handled brilliantly, as I recall.

  • Reply 9 of 82
    sockrolidsockrolid Posts: 2,789member

    Quote:

    Originally Posted by AppleInsider View Post



    [...] The Windows RT model is set to go on sale in conjunction with the launch of Windows 8 this fall to be followed by its larger, and presumably more expensive, brother three months later. [...]


     


    Let me take a wild guess at the Surface and Surface Pro pricing.


     


    Surface: $399.  Because we're Microsoft dammit.  And Surface is just as good as iPad.  And it's magnesium!


     


    Surface Pro: $699. Because we're Microsoft dammit.  And because none of those Ultrabook weenies can hit the $699 price point.

  • Reply 10 of 82
    solipsismxsolipsismx Posts: 19,566member
    Wait a minute. Didn't Ballmer say that Microsoft now wants to take another stab at the vertical business model like Apple XBox? To better integrate, and create synergy between, HW & SW? What this guy Shih is saying completely contradicts that. So are these simply demonstrative models to show the 3rd party OEM's how it's done and then the plan is to later pass the baton to them? There's a lot of fuzz surrounding this whole thing, including the seemingly intentional omission (possibly due to cost) of cellular connectivity. Either Microsoft is completely desperate or they think they hold the key to the Holy Grail. I feel it's the former.

    I think Ballmer was absolutely lying of they would have been trying to do this for awhile and buying up companies that can help them achieve this goal for some time now. The bottom line is MS doesn't want to lose their bread and butter and all that rides on getting Windows onto the devices we use every day. Without Windows on tablets it will likely be a slow death if they can't find a way in or a way into another business.

    On another topic...I've been too busy to look for and watch the whole Surface unveiling thing but have the device freeze-ups during the NetFlix app segment been edited out from the posted video? I know Apple has had a few faux pas during keynotes also but do they edit them out before posting the video for public viewing? Apple's have never been that bad so I've never really looked for them while watching. One that comes to mind is lack of bandwidth due to attendees hogging the WIFI. Not exactly a device problem but a slightly embarrassing incident, one that Steve handled brilliantly, as I recall.

    That video showing the differences between the iPad and Surface introductions was funny but was also very slanted. I seem to recall the WiFi issue, at least one app crashing, and Safari showing the NYT website with Adobe Flash placeholders.

    I also recall the iPad introduction being my least favourite Apple event because it seemed less focused and prepared than the others often going back and showing the same thing repeatedly. My favourite being the iPhone introduction.

    PS: Where are the people claiming it only cost 12¢ in parts for cellular? :D

    sockrolid wrote: »
    Let me take a wild guess at the Surface and Surface Pro pricing.

    Surface: $399.  Because we're Microsoft dammit.  And Surface is just as good as iPad.  And it's magnesium!

    Surface Pro: $699. Because we're Microsoft dammit.  And because none of those Ultrabook weenies can hit the $699 price point.

    I think both of those are very, very aggressive pricing models. Remember that in lots of 1000 Intel's starting point for the Surface Pro CPU is $225. Sure, MS can get extra discounts as they will buy a lot more than that but simply buying the CPU isn't the only price consideration. Apple is already very aggressive on pricing even though some don't think they are because Apple is smart enough to actually use efficient and effective business practices to turn a healthy profit.
  • Reply 11 of 82
    It kind of amuses me that the very best that Microsoft's internal development team can do for a new UI is a bunch of colored boxes with text in it. I am not sure why on earth anyone would think that a giant colored box is good UI but I am personally shocked at the stark laziness of the UI.

    I was at my pub a few months back, and a Microsoft session apparently let out near by. A drunk Microsoft advocate of some kind was giving me a hard time for doing some work on my iPad saying that people who used Apple products when working in the tech space (which I do) were "Hypocrits" because Apple products were "consumption" devices and that the giant colored boxes were "Post Modern" compared to Apple's "Modern" UI. It's amusing to me that certain people will swallow the marketing diatribe that Microsoft puts out, and claim it's correct. I am sure someone will claim the same thing with Apple, and thats all well and good. One man's junk is another mans treasure. But lets look at the facts. The only reason why Microsoft is making Windows 8 a tablet OS is because adoption of Windows Phone for developers was so tragically low that they knew they couldn't get developers to back up a derivative of that on a tablet. So what do they do? They know that if they forced all of their desktop developers to make applications for the next version of Windows that just happened to be a tablet os they would have more of a fighting chance. Thats fantastic, except that Windows 8 is now a HORRIBLE desktop UI.

    I go to quite a few Microsoft development workshops. Not because I like their desktop software, but because it's the reality of the server world, and frankly thats fine. Most of the people who present at Microsoft development user group meetings are using Mac's running Mac OS X. They show their Visual Studio demonstrations in either VMWare Fusion or Parallels. Nope, not Boot Camp.

    All of my Java and .Net developers are so disgusted with what Windows 8 means long term that most of them (over 60%) have bought Mac's to use with plans to use Visual Studio in a VM.

    The cold hard reality of the software development world that I personally work and live in? We are all hired guns who will write software where there is volume. Rub us the wrong way and we'll leave. For most of history that meant that most developers used Windows. I never thought I'd see the day when my developers would laugh saying that they hope to never be called "Metro Engineers".

    Maybe this is biased from the people I know. But this is a fact. More and more people are using Mac's in the Windows development world.

    Will Microsoft Surface succeed to a certain degree? Personally? I don't think it will be any more successful then the Lumia 900 or 800. I hope it is though. The more competition there is the better it is for the end user.
  • Reply 12 of 82
    gazoobeegazoobee Posts: 3,754member

    Quote:

    Originally Posted by SolipsismX View Post



    I agree with this wholeheartedly. MS doesn't want to sell the complete widget they simply want Windows to be dominate so they can get OEMs to suckle their teat. Unfortunately since Windows has no real smartphone, tablet or ARM-based presence they are not just losing out but the gravitational forces of those three categories have stagnated and will shrink the WinPC market if they don't think of a way to fill the void with Windows.

    Perhaps not the best plan, just like when they screwed over their Play4Sure OEMs when they created the Zune, but it's a plan and it's either case MS is trying to make a move into the HW side long after the dominos have fallen. I quite like many aspects I saw with the Surface itself but there are so many questions and concerns about the way it was shown, what wasn't shown, the lack of hands on, the time frame to release, price questions, etc. that it's looking as dead as the Zune, which was a very solid device by version 2.0. Too little too late.


     


    It certainly looks like a fake-ish kind of ploy from Microsoft, but I'm not as certain as you.  


     


    The trouble is, this is one of those "damned if they do, damned if they don't," kind of scenarios.  As Horace Dediu pointed out recently, Microsoft can't make enough profit per unit in this new mobile Post PC era to survive.  So while they will almost certainly fail if they try to go vertical and mimic Apple, and while it's truly an insane thing for them to attempt on the face of it, if they don't do it, they will fail anyway.  


     


    Therefore, it's kind of a toss up as to whether it's an insane last ditch attempt to completely re-envision the company, or an insane last ditch attempt to fire up the OEM's. Both are crazy, both have little chance of success.  

  • Reply 13 of 82
    gazoobeegazoobee Posts: 3,754member

    Quote:

    Originally Posted by SockRolid View Post


     


    Let me take a wild guess at the Surface and Surface Pro pricing.


     


    Surface: $399.  Because we're Microsoft dammit.  And Surface is just as good as iPad.  And it's magnesium!


     


    Surface Pro: $699. Because we're Microsoft dammit.  And because none of those Ultrabook weenies can hit the $699 price point.



    These prices are not only wildly low relative to the BOM costs, they are low compared to Microsofts own statements on pricing (such as they have made).  Surface Pro is supposed to be priced "comparable to other ultrabooks" and Surface is supposed to be priced "comparable to other tablets."  


     


    It's more likely that they will suck up a zero point margin on the Surface RT in order to price it at the exact same price point as the iPad and that the Pro version will be between $899 and $1,000 as most of the rest of the ultrabooks are. 

  • Reply 14 of 82
    nagrommenagromme Posts: 2,834member


    This tablet is very cool in a way (if it works—they were unable to actually demo much). But not in a way worth buying for most people: it’s a new way of making a tablet exactly what Steve Jobs and Apple avoided like the plague: a bad laptop! Microsoft has a long history of trying to make a tablet be like a laptop in various ways. Don’t make a bad laptop, make a great tablet.


     


    And remember, they said pricing would be in line with ultrabooks. NOT in line with tablets! I’d hate to enter a market full of iPads (plus some Kindles, plus maybe some cheaper/smaller iPads soon) with a price point above $500. (I’m assuming some ARM models may at least start that low... which will them be even WORSE Windows laptops. The ARM/Intel choice is just a mess for buyers.)


     


    Tunnel vision.


     


    But given that, they have indeed done some original things here! The OS especially, young though it may be.

  • Reply 15 of 82


    As I look at the extremely tight packaging on the Surface tablet, it makes me wonder if they can really keep an i5 or i7 chip cool enough to run well. The first presenter seemed so nervous that it was as if his job was on the line. He didn't do a great job, especially when his unit froze.



    The guy who focused so much on the kickstand was just strange. He kept stressing how important the kickstand was to the device. It was as if the whole thing wouldn't work without the kickstand.



    In a way this was the one chance for the hardware guys to get some credit instead of the software guys. Though I have read recently that over 50% of the X boxes had hardware failures. That sounds terrible. If that carries over to the Surface tablets then this absolutely will be another nail in the coffin for Microsoft.



    Is this just a ploy by Microsoft management to force their hardware partners to improve their products and innovate? I don't know. It is some type of ploy but to what end? I think they'll dump this off on an OEM or sell the rights to make it in a year.



    I bought a spare computer in 2009 with Vista. It had two hardware failures under the first month of the warranty. I can document being on the telephone with HP tech support for at least forty hours that year. Some of it was related to hardware and some of it was related to Vista. If Microsoft can't get it's software working better than that, no amount of cool hardware will help them.



    Microsoft is still a growing company. People shouldn't forget that. Eventually they'll anger enough people with their crappy Windows software that people will seek alternatives. I had to work on Windows today and hated it. Everything I wanted to do just took longer to accomplish. It's just yucky. Eew. Bad vibes all around.

     

  • Reply 16 of 82
    a_greera_greer Posts: 4,594member


    as a long time windows user and mac user who enjoys both platforms I love this! Let customers see how great Windows is when it isnt fucked up by oem crapware.


     


    also I think the intel version is very compelling, its what I wanted the iPad to be - a tablet when it makes sence, leaned back on the couch, on a plane or something, but a serious laptop when I need to really work...1 device, no need to have internet connections everywhere and rely on and trust a third party cloud serviceto ensure that my laptops documents are synced with my tablet.

  • Reply 17 of 82

    Quote:

    Originally Posted by indiekiduk View Post


    sounds like Shih forgot about the Xbox



     


    Looks like indiekiduk forgot about the RRoD, scratched discs.


    The highest quality in manufacturing it's not.

  • Reply 18 of 82
    markbyrnmarkbyrn Posts: 637member
    Or in other words, Ballmer did a dog and pony show with a prototype and the lap dog tech media pundits lapped it up.
  • Reply 19 of 82
    neosumneosum Posts: 111member

    Quote:

    Originally Posted by SockRolid View Post


     


    Let me take a wild guess at the Surface and Surface Pro pricing.


     


    Surface: $399.  Because we're Microsoft dammit.  And Surface is just as good as iPad.  And it's magnesium!


     


    Surface Pro: $699. Because we're Microsoft dammit.  And because none of those Ultrabook weenies can hit the $699 price point.





    I think it's more like:


     


    RT: $499 because they think it's better than the ipad.


    Pro: $999 because they think it's better than the mba.


     


    The fact that they haven't released the price shows that it's gonna be high. All they said was that it would be "comparable" to the prices of their competitors. They're trying to build excitement without disappointing people on price. When it's finally revealed, they're hoping the excitement drowns out the high prices. Had the prices been low, they'd have it plastered everywhere already.


     


    I'm no expert, but I think the only way they'll succeed is on price. At $299 for the RT and $499 for the Pro, they'll sell. At the price they want to charge, I doubt it'll do better than a few million units at most.

  • Reply 20 of 82

    Quote:

    Originally Posted by markbyrn View Post



    Or in other words, Ballmer did a dog and pony show with a prototype and the lap dog tech media pundits lapped it up.


     


    yeah, engizmoverge lives to worship novelty. and specs.

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