Microsoft Surface Sales Hit 1.5 Million But Still Shy of Expectations

When Microsoft decided to launch its own hardware with the Surface tablet, it was a big gamble, and many noted that even after its unbridled success in the operating system, software, and gaming hardware markets, the company may find the tablet hardware side of things to be tougher sledding. According to Bloomberg, that’s indeed what is happening now, as sales of Microsoft’s tablets are falling far short of expectations.

Three sources told Bloomberg that the company has sold approximately one million Surface RTs and 400,000 Surface Pro tablets; while that’s not nothing, Microsoft reportedly ordered 3 million Surface RTs, which means that there are still 2 million of them sitting in warehouses right now. One analyst projected that Surface sales would hit 1.4 million in this current quarter, but he has now adjusted that number to less than half, at 600,000.

Surface tablet

Lagging Surface sales are all the more alarming because of the booming sales of tablets overall. Bloomberg notes that tablet sales are expected to climb to 190.9 million this year; Microsoft can only claim a very small sliver of that number for now.

Microsoft has a huge task on its hands; the company must be able to convince consumers to both move to its Windows 8 operating system and also buy a tablet running it. So far, it hasn’t done a great job of either.
Via:  Bloomberg
NathanaelBahjejian one year ago

I would buy a Tablet earlier however i do not trust windows 8. From all the reviews I have read they haven't been great. I buy buy one if it was windows 7 format

JDiaz one year ago

There isn't much point in getting a tablet with Windows 7, these have been around for awhile but always have been a niche market because it'll just be harder to use on a tablet (no tablet optimization) and won't be able to take advantage of power efficiency options like S0i Power Management states that you can get on newer chips like Intel Clover Trail and the upcoming Haswell...

So, if you prefer Windows 7 then get a laptop instead! Or stick to either Android or iOS if you really want to use a tablet but continue to not trust Windows 8.

PaulConnell one year ago

I would love a full Windows tablet, but Microsoft's Surface is just not compelling and, frankly, their whole attitude has been turning me off lately:

-Surface is overpriced to start, and accessories are nothing short of price gouging ($120 for a keyboard is INSANE).

-Storage is too limited, standard options are way too expensive ($100 for an additional 64 gigs), and the thing is glued shut so you can't even upgrade it yourself without risking almost certain damage.

-Windows 8's in your face "our way or the highway" Metro UI is a turnoff.

And this is from someone who's installed 8 on all my systems and generally likes it overall. The reality is that Microsoft is the one playing catchup in the mobile/tablet space, they really need to offer compelling value. If they're not going to do that, their products should warrant their premium price, but offering mediocre products at premium prices is a recipe for... well, exactly the abysmal sales they're seeing.

JDiaz one year ago

"-Surface is overpriced to start, and accessories are nothing short of price gouging ($120 for a keyboard is INSANE)."

In comparison to what?

I'm not disagreeing with the sentiment but the reality is you pay more for a less powerful iPad (vs the Pro) that doesn't come with digitizer pen, can't run any desktop OS, doesn't have any built in ports besides the universal dock, has no built in memory card options, and most keyboard docks are $150-$200 for Android tablets, like the Asus Transformer models, too!

The Surface keyboard options may lack a battery and ports but it's still not a cheap basic and bulky keyboard either. Most low cost keyboards can't be used as covers, generally don't have touch pads, and are much thicker and bulkier than the Surface keyboards.

Sure, it would be nice if they could lower the prices but they're not at the point that they can yet.

Thing to keep in mind is that Tablets have high margins and they're more expensive to make than equivalent performance laptops.

So they'll have to lower both the margins and the costs of making tablets before they lower the prices much more, but they're not going to get cheaper than equivalent laptops, and that's still going to take time.

Meaning, it's not that it's so much overpriced but that it's too premium a product for what you and many others are willing to spend on this type of product but that's the nature of tablets in general right now.

They could get it to a more acceptable price point sooner but that'll mean stripping it down to a very basic tablet and costly features like a active digitizer pen would be removed but that'll make Windows much harder to use on such tablets, especially with high resolutions. Since the desktop still doesn't scale well to high resolution with small screens!

Meaning, we're just not at the point they can make this appeal for the masses yet without a lot of compromises.

"-Storage is too limited, standard options are way too expensive ($100 for an additional 64 gigs), and the thing is glued shut so you can't even upgrade it yourself without risking almost certain damage."

Again, I agree with the sentiment but we'll have to wait till about the end of this year before we see more capacity being offered. SSDs are still well behind HDDs for capacity and pricing.

While, part of the issue is how they justify pricing for tablets in general. Tablet market pretty much sets device pricing according to capacity offered. So everything from a Nexus and iPad to a Windows tablet rounds off the pricing according to the capacity offered even if the cost difference is much smaller.

This helps protect their margins and stabilize price ranges... So it's a issue with the tablet market as a whole and not just Windows tablets. Hopefully, this will change as the market matures and more consumers demand more value for their money but that'll take time, just like how Ultrabook pricing has taken years to get more acceptable but are still higher priced than regular laptops.

Even ARM tablets running Android weren't always as affordable as they are now, heck, even e-Readers like the Kindle used to cost hundreds.

I agree with everything else you stated though... MS does have catching up to do and they need to offer more value but it's not something that will happen overnight.

WarrenEarls one year ago

Hey man it's pretty much windows 7 without a start menu and with a Xbox store its really nothing special at all.

JFan one year ago

If the price drops to clearance levels because of this surplus I might get one.

ricofrost one year ago

The surface RT is pretty much right on the money, getting office with it is a massive bonus. Yes the keyboard is a little expensive but still cheaper then the Ipad.

There has been a lot of bad press about the MetroUI, to be honest its fantastic for the tablet... if you dont like working on it go to the desktop.... its really not that hard at all.

I use windows 8 on my home pc, work and on the tablet and now also the phone. I really love the live tiles and how fast and responsive windows 8 is.

Kind of reminds me of the Xbox everyone though there is no way they will catch up, now its number 1.

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