Windows Surface Takes Another Step Towards Irrelevance

Windows Surface tablets haven't been the hot seller Microsoft had hoped for. Source: Microsoft.

If Microsoft (NASDAQ: MSFT  ) is serious about bringing Office to Android before it reaches Windows, then it's time to start winding down the tablet business. Windows Surface is facing irrelevance.

ZDNet's Mary Jo Foley cites unnamed sources who say Mr. Softy is pushing back its release date for the new touch version of Office for Windows 8 from fall 2014 to spring 2015. An Android version is due in the interim, which can't be good news for Microsoft Stores selling Surface tablets. But is it good news for Microsoft stock? I think so, yes.

Robotic virtues
Windows isn't the draw for tablet users that Android is. According to Gartner, Microsoft ended 2013 with 2.1% of the overall tablet market with roughly 4 million Surface tablets sold. Android commanded 62% of the market over the same period, while the iPad accounted for the remaining 36%.

Growth in tablet shipments is expected to slow from over 50% last year to about 12% in 2014, IDC says. Android will nevertheless continue to dominate with 64.4% of the market, followed by 30.3% for the iPad, and 5.3% for Windows Surface, the researcher says. Microsoft's own tablets comprise a relatively tiny portion of the addressable market for touch-activated Office apps.

Selling by brand versus platform
You can bet that Microsoft CEO Satya Nadella is aware of these statistics and others like them. After all, in taking the job, he promised that Mr. Softy would not be "bound to one app, on one device, in one place." Rather, he'd order his team to build cloud-capable software that could exist on a variety of platforms while performing better than alternatives. Office for iPad is proof the strategy can work.

Microsoft's Excel for iPad was the 61st top-grossing iPad app as of this writing. Credits: iTunes App Store, Microsoft.

We're seeing it in the Office 365 numbers. Sure, anyone can download basic versions of the Office apps to an iPad. Full functionality requires a subscription that can run as much as $99.99. All told, Microsoft generates roughly $2.5 billion of Office 365 sales annually as of this writing.

For Microsoft, that's a huge shift. The company once known for "embracing and extending" others' software and tools is no longer selling a platform but a brand. In this case, Office, the world's best-known and most-used productivity software. More than 1 billion people around the world use some version of Office, Microsoft says.

All of which is to say that Office matters more to Microsoft than Surface does. That Nadella is addressing this reality now by getting the latest touch version to Android first is good news for every Microsoft shareholder. Do you agree? Are you using Office 365 on the iPad? Leave your comments in the box below.

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  • Report this Comment On June 09, 2014, at 9:51 AM, alup wrote:

    Microsoft should offer a trial version of windows 8 on these tablets with Android. I think many people would be surprised with the similar nature of the two programs and with windows they could still have the windows 7 interface that many are comfortable with. They could also offer a full version for purchase. This way you could have a dual boot version customer could "learn" windows while having android available.

  • Report this Comment On June 09, 2014, at 11:16 AM, bobbyedwards wrote:

    Why do writers forget that the full Office 2013 suite is available on the Surface Pro, as is every other software title Microsoft puts out. Even if you are running the Surface RT, you have had a version of Office on it since the day it hit the sales floor. However it you use an Android tablet, then just iPad users until a month ago, you have nothing, which means if you subscribe to Office 365, your only choice is Office online.

    I am not sure what part of that is so confusing to so many writers.

    So how you figure this kills surface, I will never understand, you think people are buy them in the hopes that a new Modern UI Office will soon be made available? I don't, I think they get them because they are fast powerful lightweight machines, that allow to work away from the office.

  • Report this Comment On June 09, 2014, at 12:18 PM, BigDady wrote:

    This piece is what's foolish always 100% negative regarding Microsoft surface pro if this were a Apple product it would be the exact opposite.

    Is the surface pro a niche product sure but the niche is there I own the sp2 256/8 gig and it's a beast in tablets clothing those who try and have the budget buy it's a little early in the cycle but I look forward to giving my sp2 to my son and picking up the sp3 when the I7 models are available.

    Btw the fools might try to be unbiased and objective when putting the foolishness out for public consumption.

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