With the joint release of Windows 8 and its homegrown Surface tablet, 26 October will be the most important day in Microsoft’s life. The day will be fraught with risk: On the one hand, Microsoft could cement its transition from a maker of desktop software, to a modern, mobile and device-oriented company – but on the other, if Windows 8 and the Surface fail, Microsoft will have all but guaranteed its obsolescence and eventual subsumption by Google and Apple.
Windows 8, with its “modern-style” (Metro) interface and other questionable design decisions, is by no means a dead cert. The Metro Start screen and apps force Windows 8 users to undergo a complete paradigm shift – which is tolerable for consumers, but abhorrent for enterprises, who are not fond of having different usage patterns forced upon them.
This isn’t to say that the Metro interface itself will be bad for productivity, or that it won’t work with enterprise apps, but in a world where corporate entities are still actively switching from XP and Vista to Windows 7, I don’t foresee many companies rushing to embrace the Windows 8 paradigm shift.
And then there’s the Surface tablet, which represents Microsoft’s turning point from being a software company, to a “devices and services” company. This move has been a long time coming, but it was undoubtedly hurried along by the very rapid growth of devices – non-PC computers such as smartphones and tablets. While Microsoft still has a complete monopoly on the desktop PC market, its overall share of internet-connected computers is rapidly diminishing. The Surface tablet, along with dozens of Windows 8 OEM tablets and convertibles, is Microsoft’s attempt to gain a foothold in this new market.
Since the Surface unveil in in June, Microsoft has been incredibly coy about its first-party hardware plans. We were given very few details about pricing and availability, which led us to believe that the slate would be very expensive. CEO Steve Ballmer said that MS would sell “a few million” tablets in the first 12 months – but given that 375 million PCs are expected to be sold in 2013, a few million would be just a drop in the ocean.
Today, we can finally shed some light on Microsoft’s true plans for the Surface. As we noted earlier, according to a Wall Street Journal report, Microsoft has placed an order for between 3 and 5 million Surface tablets in the fourth quarter of 2012. So you have some idea of the scale, this is roughly the same number of tablets that Apple sold in the iPad’s first quarter. An order of 3 to 5 million is around the same amount of Kindle Fire HD tablets that Amazon ordered. This isn’t penny stakes; MS is intending to shift a lot more than “a few million” tablets in the first year.
Second, and perhaps more importantly, we now know the US price of the ARM-powered Surface tablet: $499 (£310) for the 32GB model without the keyboard Touch Cover, $599 (£372) for the 32GB with the Touch Cover, and $699 (£435) for the 64GB model with Touch Cover. To put this into perspective, over in the States, the standard 32GB Surface is $100 cheaper than the 32GB iPad 3, and around the same price as the Asus Transformer Prime. UK pricing will doubtless be pretty much in line with this, and while I don’t think Microsoft is selling these tablets at a loss, it definitely looks like its primary goal is to attack the iPad, rather than raking in fat profits.
For that money, you get a 10.6in tablet that has a quad-core processor (probably Tegra 3), a full-size USB socket, SD card slot, and a micro HDMI socket. The whole thing is 9.3mm thick and weighs 676 grams (marginally fatter and thicker than the iPad) – but it does come with a built-in kickstand for table-top use. The only real downer is that the Surface tablet has a 1366 x 768 display, while the iPad 3 rocks a best-in-class Retina-quality 2048 x 1536 screen. Microsoft is probably counting on this difference not being worth $100 in the eyes of consumers – or that the kickstand and bundled version of Microsoft Office make up for the display’s shortcomings.
To ensure that Windows 8 and the Surface succeed, Microsoft has reportedly set aside no less than $1.5 billion for advertising. The first fruits of which you can see below, starting with the ad for Windows 8:
And as we reported earlier today, the first ad for the Surface aired in the US last night:
And then there's also this advert for the Surface:
In addition to these videos, Microsoft has also begun covering US cities with Surface street art:
Rest assured that these stylish, viral, and exceedingly expensive ads are just the beginning of a massive marketing blitz to convince the public that Microsoft is cool, Windows 8 is a paradigm shift worth investing in, and that the Surface is a viable alternative to the iPad.
With a beachhead established, Microsoft will then proceed to push Windows Phone 8 down our throats as well, dressing it up as the perfect companion device to Windows 8 (which, in all fairness, it probably will be). In comparison, Microsoft spent $500 million on marketing Kinect – more than it spent on marketing the console itself. $1.5 billion is a monumental figure to spend on marketing.
Meanwhile, of course, there is the persistent rumour that Apple is gearing up to pre-empt Microsoft with an iPad Mini – and Google, of course, is due to release a bunch of Nexus devices at the same moment that Windows Phone 8 sees the light of day (29 October). Amazon, meanwhile, seems to be enjoying very healthy sales of its Kindle Fire and Fire HD tablets.
The mobile computing segment has never been more exciting. This winter, and the all-important Christmas shopping spree, is going to be a very interesting time indeed.
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