Wednesday, June 20, 2012

Microsoft Surface (few more thoughts...)

After day 1of the announcement of new gadget by Microsoft, I've further read more news and comments about this product. I still keep the comments in my last post as valid and I've few more thoughts as follow:

8. MS decided (for now) to sell Surface in 25 of its own stores and online means that MS is not confident of this product. Some news stories said that MS has to sell Surface at a loss in order to make it a hit. That's something that I agree. Just see HP's Touchpad as an example, the fire sale of that generated a lot of buzz of that product, unfortunately that was after HP abandon it for good. So, in order for MS to get as many people to buy Surface as possible under iPad's dominance and to compete with Kindle Fire/Samsung Galaxy Tab II, it has to undercut its profit margin for Surface for now. To be honest, with 60B (if I read it right) of cash, MS can take this loss. Cuz, MS has to plan for long term. What makes money is the services and software/apps. That's what Amazon is doing, and MS is no Apple. Since MS is not gonna sell Surface nation wide in the U.S. Unless it wanna to build lines around the blocks to create buzz for Surface, otherwise, MS is not planning to sell Surface cheap. That's just stupid!

9. MS seems only inform its hardware partners last minute before Steve Ballmer show Surface to the world in L.A. I don't blame MS to keep ASUS, HP, Dell, Acer, Lenovo, etc in the dark. That's business strategy. Today, many news stories saying that those hardware makers are gonna be upset and even revolt down the road against MS. I think this idea is overblown. Cuz, what choice do they have? Another story bought my attention that Google is gonna announce its own bland-named Tablet before end of this month. So, most hardware makers can't flock to Android for cover to give a middle finger to MS. Cuz, all OS makers also makes their own hardware. If they wanna stay in the game, they just have to stay in line and suck it up. The upside is that those hardware makers just have to innovate and make better tablets and manage to stay profitable after paying Window license fee to MS, or as I would predict, they will put more effort on make Android based tablet just for the reason of no license fee and better app markets then the Window camp. Basically, picking the less of two evils!

10. I think the Surface itself is not a bad product, the engineers in MS did do a good job making this machine. The type cover is sure a 'bridge' of the tablet and ultrabook world. I wouldn't be surprise that some 3rd party manufacturers will make such cover for iPad in few months. Then, the hardware gap or highlight of Surface will be gone! As I said before, it all goes back to Apps, costs, security, easy-to-use, and ultimately the eco-system that will determine the winner in Tablet, just like smartphone. MS is far behind in Smartphone market, I doubt it will catch up anytime soon. Nokia's hardware is fine, but you just don't see many people has a Window 8 phone. Tablet is similar. For MS, it will thank God that Android's footing in Tablet market is nowhere like it is in smartphone market. However, both markets share actually share more than deviate from each other. They are about mobility, communication and content consumption. MS's skype would help a lot, but not for the rest. Who care about MS Office these days? With my prediction of hardware makers will tilt more to Android than Window, I would predict that the future market share breakdown among iOS, Andriods, and Window 8 would more or less the same as that in smartphone.

That's all for now!


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