I Was Wrong About Microsoft's Surface

After months of lagging sales, retailers are cutting prices on several tablets and convertible devices using Microsoft's (NASDAQ: MSFT  ) Windows RT operating system, IDG News Service reports. In the following video, Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova says the data show he was wrong to declare the Surface RT a hit shortly after release.

Stiff competition has taken a toll. Apple (NASDAQ: AAPL  ) enjoyed huge holiday sales of the iPad Mini, while Amazon.com (NASDAQ: AMZN  ) continues to seed the market with its low-cost Kindle Fire.

Does the Surface RT have a future? Will Mr. Softy go back to making Intel-only devices? Please watch and then leave a comment to let us know what you think of Microsoft's tablet prospects.

For further analysis of MIcrosoft's mobile ambitions, check out our newest premium research report in which we dissect Mr. Softy's sprawling empire and tell you what the company is worth, and whether the stock deserves a place in your portfolio. Access your report now by clicking here.


Read/Post Comments (7) | Recommend This Article (2)

Comments from our Foolish Readers

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  • Report this Comment On April 05, 2013, at 7:33 PM, dwilh51183 wrote:

    IF YOU'RE GOING BUY AN IPAD THE ONLY ONE TO BUY IS MADE BY APPLE. IT DOMINATES ,IT'S GOT THE BEST QUALITY, AND IT HAS GOT THE BEST RESALE VALUE ! SO BUY APPLE IPADS. ALL THE SCHOOLS AND COLLEGES ARE USING THEM NOW

  • Report this Comment On April 05, 2013, at 10:00 PM, peanutgalerygeek wrote:

    My problem with the latest Microsoft update is that their attempt to tie PC and tablet user experience together is confusing. It's not so much the big stuff, it's the little stuff like how to do all of those Word options. It's not obvious.

  • Report this Comment On April 06, 2013, at 12:55 AM, cfrdog wrote:

    Bought 2 Samsung tablets for xmas for the kids. They were super excited about them. NOW? Nobody uses them, including me. I like my laptop. Now to be fair I have a 7 inch model and I think owning a larger screen might have been the better choice. Still I prefer a laptop. Tablets might just be a fad.

  • Report this Comment On April 06, 2013, at 1:32 AM, Klippenstein wrote:

    Are you talking only about Microsoft Surface RT or also Surface Pro? In anycase, I think you are wrong to pull your endorsement of Microsoft Surface RT. Have you ever used one? For what? For anyone wanting a PC "light" with a touch tablet interface this is a great product. My wife, a writer bought one, and loves it. Just because iPad and Amazon Fire are selling more only means something if the trend is long term. Once people figure out that Microsoft Surface and Windows Tablet PCs allow them to "have their cake and eat it too" iPad's market share will go the way of iPhone and MacBook ... toward sub 10% worldwide market share. A rational market response to Windows 8 touch Tablet PCs will be to buy them (and I am not talking about cheap, traditional notebooks running Windows 8). Businesses will be rational. Schools will eventually adjust to what children need to learn for the business world (or at least the smart schools will). No business (or financially intelligent person of limited means) wants to be left with having to carry two large screen devices around (e.g., iPad and MacBook -- plus their phone -- when one large screen device that does it all is available for 1/3 to 1/4 the price.

  • Report this Comment On April 06, 2013, at 1:49 AM, deasystems wrote:

    @cfrdog: The problem isn't with "tablets;" it's with your choice of tablet. Get yourself and the kids the real thing—iPads.

  • Report this Comment On April 06, 2013, at 2:16 AM, herky46q wrote:

    There is no going back to a desktop or laptop for me. The iPad really can be your only computer.

  • Report this Comment On April 08, 2013, at 11:24 PM, Thadeus99 wrote:

    Tim -

    Can you explain what you mean by "there's a real push to move to Windows Blue?" Windows Blue hasn't even had a preview release from Microsoft yet.

    Also, I think you should look deeper into the Surface Pro phenomenon. It should be no surprise that 400,000 people exist who would like a 'true PC' on a slate form factor. They are classic tech enthusiasts. Who else would be willing to put up with minuscule fonts, icons, and menus (it is a true PC, but one with a high resolution 10" - think netbook-sized - screen that squeezes in what normally gets displayed on a much bigger screen). Surface RT wasn't interesting to these folks. It was just a poorly-executed tablet. Surface Pro is a PC on a Slate!

    But, 400,000 isn't enough units for anyone to make a business out of. Even Microsoft. The only true indication of success for Surface Pro will be when Microsoft can sell more than 5 million of them. And that means they have to appeal to the mainstream buyer.

    And, here's my prediction: that isn't going to happen. Combine the impractical user interface experience for the average user with the insanely high price tag, and it screams "my addressable market is almost non-existent." Imagine the Venn diagram of "Americans who earn <$50,000 per year" overlaid with "Americans who buy their shoes at Jimmy Choo". (Would we call these people Choo Shoe Enthusiasts?)

    Here's an interesting idea for an article: go find out what kind of user is buying Surface Pro devices, and see what the return rate is when the customer isn't a tech enthusiast.

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