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Microsoft Continues To Lose Money With Each Surface Tablet It Sells

Soulskill posted about 4 months ago | from the when-temporary-strategies-become-permanent dept.

Microsoft 179

DroidJason1 writes: "Revealed from a 10-Q filed by Microsoft with the U.S. Securities and Exchange Commission, Microsoft has been losing $300 million and counting for the Surface in the last nine months. Data from Strategy Analytics has also revealed that Microsoft's Windows-powered tablets now own a 6% global tablet share, in Q1 of 2014. Android, on the other hand, remains at the top with a 66% global share. Apple's iOS fell to 28%."

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The Mircro$oft $urface (5, Funny)

penguinoid (724646) | about 4 months ago | (#46875323)

Just kidding, they can have their S back. For now.

Re:The Mircro$oft $urface (1)

Tough Love (215404) | about 4 months ago | (#46875333)

HmM, $ubtle

Re:The Mircro$oft $urface (1)

crovira (10242) | about 4 months ago | (#46875691)

That's not funny, that's $ick... :-) Still with ALL the tablets they're selling, I don't imagine that the corporate bottom line is hurting too much.

Re:The Mircro$oft $urface (-1)

Anonymous Coward | about 4 months ago | (#46875763)

Linux Zealots, always the same stale jokes. Much like your OS of choice, you're always decades behind.

Re:The Mircro$oft $urface (-1)

Anonymous Coward | about 4 months ago | (#46876031)

What, you mean the OS that's powering virtually everything BUT the desktop/laptop? I think in terms of use in areas that the user isn't directly interfacing with, Linux is way ahead of Windows. But again, you're free to take this into an operating system war if you want (god knows that's a novel idea).

Slow follower (4, Funny)

Tough Love (215404) | about 4 months ago | (#46875325)

Microsoft is a slow follower. Just can't keep up with Linux or even FreeBSD.

Re:Slow follower (2)

Old Fatty Baldman (3630557) | about 4 months ago | (#46875611)

That's a little off-topic, but at the same time, I think comparing a surface to a Linux tablet makes more sense than comparing a Surface to an iPad or an Android tablet: The Surface is a full-featured PC in a tablet form factor, but iPad and Android are basically spiffed-up cell phones in a tablet form factor.

Re: Slow follower (0)

Anonymous Coward | about 4 months ago | (#46875739)

Android is too. Has all the tools you need, you can even program on it.

Re: Slow follower (2)

ChunderDownunder (709234) | about 4 months ago | (#46875965)

Show me a tablet with 8GB of RAM running Eclipse and the Android SDK and I'll believe you.

Windows 8.1 on a Surface Pro is self-hosting. Android isn't - I think there was even an obscure clause in the SDK licensing forbidding certain portions from being distributed on a device.

Re: Slow follower (3, Insightful)

ozmanjusri (601766) | about 4 months ago | (#46876355)

Show me a tablet with 8GB of RAM running Eclipse and the Android SDK and I'll believe you.

People are choosing Android to get away from the Windows complexity and bloat. Why replicate it on a compact device?

AIDE, DeuterIDE etc are made for the job, and in the case of AIDE are Eclipse-compatible. Choose whichever suits your purpose.

Re:Slow follower (2)

gl4ss (559668) | about 4 months ago | (#46875839)

you think they're talking about surface pro? that surface pro(2) has 6% ha ? because uh. android tablet is actually a linux computer capable of compiling on the device without too much of trickery while the surface rt is more limited than even an ipad in that regard.

and they're already being creative to get the 6% figure, like dropping 100 bucks android tablets from being counted towards totals. (ok ok they're starting from 35-40 bucks for dualcore if you're asia now).

Re:Slow follower (3, Insightful)

DarwinSurvivor (1752106) | about 4 months ago | (#46876127)

Yeah, I find it hard to call something a "full-featured pc" if you can't even install Firefox.

Re:Slow follower (1)

ChunderDownunder (709234) | about 4 months ago | (#46876263)

Some [slashdot.org] may view that as a feature. :)

Re:Slow follower (0, Insightful)

Anonymous Coward | about 4 months ago | (#46876001)

The surface is a full computer, unlike the Android toy and iPad content consumption type of devices.

I'd actually argue that the Android and iPad tablets aren't even in the same market. The Android stuff is implicitly designed to be cheap and affordable, but you'll be throwing them away every year unless you're smart enough to know how to put unofficial firmware on them, where as the iPad is going to last until the technology changes too much and then it won't get any new firmware or software. Meanwhile the surface (unlike surface RT) you can use it until the battery becomes useless and then you throw it away OR plug it into a power brick and just use it like a desktop.

The way things are moving, is that the "desktop" will be gone from all but high-end gaming/workstation systems, at some point you will only be able to build a gaming rig from the same parts as a workstation/server, as the desktop computer will be gone, replaced with ultrabook/surface/all-in-one devices. Apple already knows this. That's why you never ever saw an apple desktop, They were either laptops/laptop-all-in-one(iMac) or workstations.

The thing that kinda makes me laugh and cry at the same time is that the Xbone and the PS4 are basically substandard PC's, but they will be the baseline for all new games, which means 90% of the crap desktops and laptops sold (anything that uses Intel's video parts) will need to be thrown away if they are being used as gaming machines. People will just not play those games on the PC, and won't upgrade their desktops/laptops when they can buy a PS4 for cheap.

Re:Slow follower (1)

johanw (1001493) | about 4 months ago | (#46876321)

The Surface Pro is a full computer, but the Windows RT version is not. RT is more limited, like iOS and Android, but on Android at least I have the freedom of sideloading programs.

Re:Slow follower (1)

Farmer Tim (530755) | about 4 months ago | (#46876007)

Just can't keep up with [snip] FreeBSD.

Netcraft confirms they aren’t dying fast enough?

Typical MSFT mistake (2, Interesting)

hessian (467078) | about 4 months ago | (#46875327)

Introduce a product near the top of what people pay for tablets, have some imperfections, incompatible with other market leaders, and plan to improve it over time.

You've got nowhere to go but up.

Then again, 6% market share is pretty good considering the above. MSFT's policy is to get an entry in the market and slowly improve it until it has everything the competitors do and innovations of their own. v1.0 is always bad, v2.0 chaotic, and v3.0 starts the war machine on its path to dominance.

Re:Typical MSFT mistake (1)

ChunderDownunder (709234) | about 4 months ago | (#46875997)

Well as others have pointed out, the included stylus with the surface pro isn't bad value if that's your cup of tea.

It's positioned for those who want a tablet AND a notebook computer but not BOTH.

Has it the impetus to worry the market leader, Apple? Not so far, as no hybrid reintegrationalist device (combining iOS and OS X) has been launched.

Would I consider buying one if I needed a portable computer? Well if it hurts MS financially and as long as the UEFI startup allows me to load my own bootloader, it's a challenger...

Re:Typical MSFT mistake (-1, Troll)

Anonymous Coward | about 4 months ago | (#46876385)

You:

Has it the impetus to worry the market leader, Apple?

The article summary:

Android, on the other hand, remains at the top with a 66% global share. Apple's iOS fell to 28%."

You zealots are weird...

Share of warehouse inventory not good metric (2, Insightful)

SuperKendall (25149) | about 4 months ago | (#46875335)

We already know the Androd tablet "market share" is a fantasy since companies like Samsung provided fake sales info [tablet-news.com] , and there's no reason to think they are not still doing so.

If Android tablet sales are so far ahead, why are Android tablet use figures so far behind [chitika.com] ?

People aren't using Androids (1)

hessian (467078) | about 4 months ago | (#46875357)

If Android tablet sales are so far ahead, why are Android tablet use figures so far behind?

They were all bought as gifts for baby boomers.

My guess is that many people who bought those are Android phone owners, and ended up using those instead.

Re:People aren't using Androids (1)

Anonymous Coward | about 4 months ago | (#46875453)

My guess is that 90% of the android tablets sold are crappy $100 ones, that people use for 5 minutes, then discover they're shit, and never use again.

Re:People aren't using Androids (0)

Anonymous Coward | about 4 months ago | (#46875547)

Pfft yeah, as opposed to my 8 core tablet with integrated 1Gb graphics which I use... to... play Candy Crush way more hardcore than you do?

They are all toys, and those $100 'crappy' ones are awesome value for money compared to most other $100 toys.

Re:People aren't using Androids (0)

Anonymous Coward | about 4 months ago | (#46875571)

I feel the same way about Windows tablets. Well, everything except the $100 price tag anyway...

Re:People aren't using Androids (1)

spark89 (3569393) | about 4 months ago | (#46876117)

Android tablets is only for web surfing, watching video and listen music, but not for serious work. In other hand, Windows 8.1 is first step in that direction. So, without serious software on Android, future for the tablet is lay Windows direction.

Re:Share of warehouse inventory not good metric (0)

Anonymous Coward | about 4 months ago | (#46875387)

they are sold in asia like crazy. I see people snapping up $50 and below stuff for kids.

Re:Share of warehouse inventory not good metric (4, Informative)

afidel (530433) | about 4 months ago | (#46875467)

Old data is old, Android is up to 24% [statcounter.com] globally, and 35% [statcounter.com] in Asia and the trend lines are pretty obvious.

Obvious Trend (3, Informative)

SuperKendall (25149) | about 4 months ago | (#46875535)

I notice you ignored North America, where the trend line is that Android is flat and Apple is increasing...

Also my main point was how bogus the Android numbers from the main summary are. You may not have noticed, but your global numbers say EXACTLY what I was saying, that "66% marketshare" is a bald-faced lie given the actual usage we are seeing. Apple is still vastly far ahead in tablet usage, and even globally the Android increase year on year is incredibly slight.

Re: Obvious Trend (2)

Kumiorava (95318) | about 4 months ago | (#46875771)

The data you provided was North American web usage. Drawing any conclusion from that is dumb when talking about global market share. You know there are other markets out there, those markets also are bigger than US markets in volume.

StatCounter number is ALL devices, not tablets (1)

SuperKendall (25149) | about 4 months ago | (#46875563)

Did you realize StatCounter is reporting figures for ALL iOS and Android devices?

Do you not think that might be just a LITTLE misleading as to what is going on with tablets???

I totally agree there is a huge wave of Android phones. I even have one. But the percentage of Android tablets compared to phones is incredibly small.

Re:StatCounter number is ALL devices, not tablets (2)

afidel (530433) | about 4 months ago | (#46875595)

Nope, those are broken out for just Tablet, mobile is a separate category for phones.

Where does it state that? (1)

SuperKendall (25149) | about 4 months ago | (#46875679)

Where does it say that, all I see in the FAQ is the numbers are for OS's. That means the iPhone/iPad numbers are muddled too, all bunched into iOS.

Re:Where does it state that? (4, Informative)

afidel (530433) | about 4 months ago | (#46875705)

Thanks (1)

SuperKendall (25149) | about 4 months ago | (#46875777)

Ok, thanks for that - I didn't see that you could sub-select the platform options independent of the OS.

So I retract what I said about the figures being mixed.

Re:StatCounter number is ALL devices, not tablets (5, Interesting)

Maxo-Texas (864189) | about 4 months ago | (#46875629)

Not sure. Good android tablets have gotten really cheap. Like $135 for more capability than a $300 android tablet only two years ago.

Meanwhile apple and surface have remained expensive.

I own two android tables and have given two as gifts. Because they are inexpensive.

My daughter owns an apple-- because her company bought it for her.

I do have a couple friends who own an apple they bought with their own money. It's cool. They have Apple TV too. But as a couple, they earn close to $250k per year and live in a $400k house and have new cars. They are not rich- but they are very far from the average americans standard of living.

Android tablets not good compared to phones (-1, Troll)

SuperKendall (25149) | about 4 months ago | (#46875701)

I have been using an Android tablet heavily for about a week now - and not a cheap one, but a $500 Samsung tablet.

Compared to the iPad it is utter crap. The phones I get, some Android phones are very nice, very smooth and very powerful. But I cannot see why anyone would buy any Android tablet no matter how cheap (or expensive) as they are barely functional (and sluggish) compared to the iPad. Never mind even just the software alone.

Re:Android tablets not good compared to phones (0)

Anonymous Coward | about 4 months ago | (#46875727)

I'd certainly agree that Android feels sluggish compared to lower-specced iPad hardware-yay, Java!-but calling it 'barely functional' on any half-decent tablet (not some $50 low-spec Chinese POS) is simply ridiculous.

Re:Android tablets not good compared to phones (4, Interesting)

marsu_k (701360) | about 4 months ago | (#46875871)

Try a 2013 Nexus 7? WRT software, I find it very odd that even today iOS doesn't support multiple/restricted profiles. They're not that useful in a phone but make perfect sense on a tablet - I can "sandbox" the tablet for my daughter to be kid-friendly (and deny access to a browser, for now).

Re:Android tablets not good compared to phones (1)

pr100 (653298) | about 4 months ago | (#46876207)

Isn't the lack of multiple profiles because of a patent for this kind of thing on mobile phones held by Nokia?

Re:Android tablets not good compared to phones (0)

Anonymous Coward | about 4 months ago | (#46876343)

No, Android has been doing this for years. Apple just want their users to buy another device, which pretty much works for them.

Re:Android tablets not good compared to phones (3, Insightful)

mjwx (966435) | about 4 months ago | (#46876221)

Try a 2013 Nexus 7? WRT software, I find it very odd that even today iOS doesn't support multiple/restricted profiles. They're not that useful in a phone but make perfect sense on a tablet - I can "sandbox" the tablet for my daughter to be kid-friendly (and deny access to a browser, for now).

No point in trying to talk sense to him. He's a died in the wool fanboy (you see SuperKendall on all of these threads trying to find any reason, no matter how vauge or far reaching to try and disprove anything slightly critical of Apple).

I highly doubt he's used an Android tablet in his life. Basically he has to recycle any old myth no matter how many times it's been disproved.

But that aside most Ipad users who've tried my Nexus 7 (2013) have commented that it's faster than an Ipad, even those who are fanboys have been begrudgingly forced to admit it's a great tablet. Software, well seeing as you use your browser for everything these days it doesn't matter but the quality of software on Android these days matches or superceeds that of Apple.

People will choose what they like, but some people like our friend Mr SuperKendall cant accept that.

Me, I like my Nexus 7 but I'd rather sell it to others on the good points of having one, rather than the bad points of the competition.

Re:StatCounter number is ALL devices, not tablets (1)

shutdown -p now (807394) | about 4 months ago | (#46876297)

Surface is not the only Windows tablet, though, and other Windows tablets are generally cheaper. Especially the recent slew of 8" devices, with prices in $200-300 range, directly competing against 7" Android tablets.

Re:Share of warehouse inventory not good metric (-1)

Anonymous Coward | about 4 months ago | (#46875565)

Based on searches run... which iOS users do far more often since there's no decent mapping programs any more. :-P

Re:Share of warehouse inventory not good metric (1)

SuperKendall (25149) | about 4 months ago | (#46875711)

Nice try but Apple users get to use both Apple Maps AND Google Maps (or scads of other mapping applications).

Not to mention that Google has has it's own mapping issues... [google.com]

Re:Share of warehouse inventory not good metric (0)

Tough Love (215404) | about 4 months ago | (#46875479)

Must be nice to live on that planet where Apple doesn't suck. New stats today say Apple has fallen even further behind. [firstpost.com]

Re:Share of warehouse inventory not good metric (2)

SuperKendall (25149) | about 4 months ago | (#46875543)

But my point stands. What does it matter what the "marketshare" number is when we know they make up the figures?

A way better indicator is still usage, and there Apple still leads by a huge percentage. Again, if those "marketshare" (note: not sales) figures are real, why is Android usage so poor compared to Apple? Do Android tablets just break more often or what? I don't think so.

Re:Share of warehouse inventory not good metric (0)

Anonymous Coward | about 4 months ago | (#46875631)

A way better indicator is still usage, and there Apple still leads by a huge percentage.

'Usage' for what? My Android tablet is mostly used for reading ebooks, and for Facebook, email and Twitter when I'm away from home. I rarely use it for web browsing because so many web sites suck donkey ass on a small touch-screen.

Where does that show up on your 'usage' numbers?

Re:Share of warehouse inventory not good metric (3, Informative)

SuperKendall (25149) | about 4 months ago | (#46875715)

I rarely use it for web browsing because so many web sites suck donkey ass on a small touch-screen.

They don't when you are using a real tablet, I use my iPad for browsing all the time. That's the point, Android tablets are simply not as useful (or as used).

Re:Share of warehouse inventory not good metric (0)

Anonymous Coward | about 4 months ago | (#46875767)

I'd agree that web browsing works better on an iPad. Not least because companies actually test their web sites on iPads, and not on Android. I looked at the Honda site a while back, for example, to see how much a new Civic costs: it uses some crappy Flash thing on Windows, it tries to use the crappy Flash thing on Linux, which just puts up an error message saying 'an error occurred' (or words to that effect), it goes to a non-Flash when using an iPad, and it tries to use Flash on Android, which utterly fails because Flash doesn't exist. Many other sites either switch to some shitty mode designed for a 3" phone screen, or keep throwing up dialog boxes saying 'hey, why read the web page, we've got an app'.

But the idea that people don't use Android tablets because they show up less in web browsing stats is simply retarded. I probably use mine about an hour a day on average, and maybe 30 seconds of that on the web. There's no way I'm going to use it for web browsing when I can use my laptop instead, but I'm equally not going to use the laptop to read ebooks when I can use the tablet instead.

Re:Share of warehouse inventory not good metric (0)

Anonymous Coward | about 4 months ago | (#46875795)

They don't when you are using a real tablet

Like one that can use adblockers?

I use my iPad for browsing all the time.

Good for you but a tablet is more than just a web browsing device.

That's the point, Android tablets are simply not as useful (or as used).

No it is that the definition of "use" for a tablet goes beyond web browsing, something you clearly cannot fathom as your concept of "use" is limited to web browsing and you even use a study of an ad network's web browsing impressions as your citation for your claim about tablet usage. Even if that study is representative of web browsing on tablets as a whole what does that have to do with tablet usage?

Stop shilling! Those are not usage statistics! (0)

Anonymous Coward | about 4 months ago | (#46875695)

If Android tablet sales are so far ahead, why are Android tablet use figures so far behind [chitika.com] ?

Because those are not tablet use figures no matter how much you misrepresent facts to say what you need them to say to satisfy your agenda. They are web browsing statistics from chikitas web ad network in the US & Canada over a 6 day period and even if their ad network in that scope over that short time were to be representative of browsing habits as a whole that is *still* just web browsing usage and not tablet usage.

Re:Stop shilling! Those are not usage statistics! (2)

stoborrobots (577882) | about 4 months ago | (#46875749)

It's from an ad network? So you mean my Android tablet running Firefox and AdBlock is not being counted? I see...

Re:Share of warehouse inventory not good metric (2)

vux984 (928602) | about 4 months ago | (#46875717)

"If Android tablet sales are so far ahead, why are Android tablet use figures so far behind?"

Methodology? I mean, I read the article you linked to:

"For the hourly usage figures, Chitika Insights sampled tens of millions of U.S. and Canadian tablet online ad impressions running through the Chitika Ad Network."

My android is running firefox with adblock...and honestly even then i don't use it much for browsing the web. I spend most of my time in apps.

Re:Share of warehouse inventory not good metric (0)

Anonymous Coward | about 4 months ago | (#46875755)

> why are Android tablet use figures so far behind

"""To determine the distribution of Web usage among tablet devices for the month of September 2013, Chitika Insights sampled tens of millions of U.S. and Canadian tablet online ad impressions running through the Chitika Ad Network."""

Perhaps Android users have access to ad-blockers.

Re:Share of warehouse inventory not good metric (1)

exomondo (1725132) | about 4 months ago | (#46875869)

If Android tablet sales are so far ahead, why are Android tablet use figures so far behind [chitika.com] ?

You shouldn't blindly rely on statistics just because they are on the internet, these guys have a pretty spotty record [zdnet.com] and they provide no methodology nor do they seem to be very consistent or believable in terms of their statistics:

For example, last May Chitika breathlessly reported that OS X usage was up 2.58% month over month (from 11.44% to 14.02%), while Windows usage was down 2.99%. There was no reason for the dramatic shift; it just happened. But one month later Windows usage increased dramatically while Mac usage was down significantly. Meanwhile, in the month of July, Chitika reported that half of all Linux users abruptly stopped using their preferred operating system, with Linux share dropping from 2.05% to 1.12%.
http://www.zdnet.com/why-you-should-be-skeptical-of-chitikas-market-share-reports-7000009363/ [zdnet.com]

It's all well and good to post a link to a pretty picture that supports your argument but there needs to be something to back that up.

Re:Share of warehouse inventory not good metric (1)

Gavagai80 (1275204) | about 4 months ago | (#46876087)

Use != web browsing. I love my android tablet, but I never use it for web browsing unless it's just for testing a design.

Re:Share of warehouse inventory not good metric (-1)

Anonymous Coward | about 4 months ago | (#46876539)

My personal experience is that most iPad and iPhone users will follow trends and won't hesitate to change their habits in order to follow those trends. They will use their iPad instead of their computer, even if there's more limitations, because their first need is to be part of something. I'm regularly on meetings where people use their iPad to take notes. That's completely inefficient, but that's more or less irrelevant for them. The iPad is a tool to create an image, not a productivity tool.

People who buy Android tablets seem to be a lot more pragmatic in general. They don't care too much about trends and they don't care if they look "cheap". They won't use their tablet if their computer, or even a pad of paper, is better for the task. Their tablets end up being used only for specific needs, like reading e-books or playing casual games.

Once using a tablet won't be "cool" anymore, I'm guessing iPad usage will drop dramatically.

Fortunately.... (0)

Anonymous Coward | about 4 months ago | (#46875347)

They don't sell very many.

Re:Fortunately.... (1)

davester666 (731373) | about 4 months ago | (#46875393)

But that's why the numbers are so bad. They were planning on making up for the losses through volume...

Xbox lost money too (0)

Anonymous Coward | about 4 months ago | (#46875351)

They've got a new boss though, I wonder if he wants to keep this up?

The gap seems reasonable (5, Interesting)

mechtech256 (2617089) | about 4 months ago | (#46875355)

"In the last nine months, Microsoft spent $2.1 billion on the Surface, and gained $1.8 billion in revenue"

That gap really isn't too bad, certainly better than the Xbox/360/XB1 numbers which follows the same strategy of selling at a loss (after marketing) and making it up later with services. The mere fact that Microsoft is actually doing 500 million dollars a quarter in Surface is actually quite impressive.

Right now Microsoft needs market share, so I'd say the strategy isn't altogether a bad one. Especially considering that 2 Billion USD in hardware sales is definitely going to result in at least a couple hundred million in service revenue from Office and such.

Re:The gap seems reasonable (1)

Sir_Sri (199544) | about 4 months ago | (#46875389)

Considering they're ~1000 bucks a pop that's not as great volume wise as it could be.

But still, the only way you make a better product is make the best product you can, find out what works and what doesn't and make it better.

(Full disclosure, Surface 2 owner, and while I'm reasonably happy with the hardware, Windows 8 is terrible, but at least I can do all of my computing on a single device on the road).

Re:The gap seems reasonable (1)

mellon (7048) | about 4 months ago | (#46875495)

Hey, if Sherlock Holmes uses it, it can't be all bad, can it?

$300M difference is not $300M loss (3, Interesting)

dutchwhizzman (817898) | about 4 months ago | (#46875509)

That's what they spent in nine months and what they got back out of it. They may get more money back on apps later on, but they have to spend money on those as well. For all we know their app market and own development may not be efficient enough to turn a profit but mostly, all the money they spent manufacturing and stocking up warehouses full of tablets and developing is suddenly not important any more? They have already written that off 100%? I'm betting they are in the red a lot more than this calculation suggests.

Re:The gap seems reasonable (1)

Demonantis (1340557) | about 4 months ago | (#46875521)

I think the majority of the problem is that Microsoft stock isn't seen as a risky growing company stock. The stockholders aren't expecting quarters with losses. Taking a loss on the tablets is hurting the shareholders profit margin and they aren't happy about it. I think the same concerns were raised with the initial performance of the Xbox so they will probably see it through and improve the tablet. The stockholders will just sit there grinding their teeth.

Re:The gap seems reasonable (0)

Anonymous Coward | about 4 months ago | (#46875821)

They aren't losing much money on the XB1 since they have pretty old technology in the machines similar to the PS4

Re:The gap seems reasonable (1)

drunkenoafoffofb3ta (1262668) | about 4 months ago | (#46876269)

I'm one of these Surface RT toters (and I like it), and Office 2013 RT was free. There's no way in hell I'd move to Office 365 -- Word and Excel are mature, I'm used to the ribbon, and I can't really see what more they can do to make it worth the subs money. If I need to edit a Word doc on the go? I have my tablet. Forgotten that? Google Docs in a bind, but I'm no worse off than before they went to a subscription model.

Re:The gap seems reasonable (1)

Threni (635302) | about 4 months ago | (#46876471)

How are they going to make money on services? I've bought a number of Android phones and tablets over the years, and spent about £20 in total between them. (An no, I have no pirate software whatsoever). You just don't need to buy software for mobile OSes, as the built in/free stuff is sufficient other than for games, and they're not charging £40 each for games.

With the voice of the Emperor Palpatine... (1)

Z00L00K (682162) | about 4 months ago | (#46875365)

"Good..."

Re:With the voice of the Monty Burns... (0)

Anonymous Coward | about 4 months ago | (#46875583)

"Excellent..."

Re:With the voice of the Emperor Palpatine... (1)

ChunderDownunder (709234) | about 4 months ago | (#46876019)

Now that Benedict is no longer pope, isn't it time you came up with a new meme? :)

So What? (5, Interesting)

rudy_wayne (414635) | about 4 months ago | (#46875367)

Microsoft lost a few hundred million on the Surface tablet. Twitter has never made money lost $500 Million in the most recent quarter.

So what?

Re:So What? (1)

Anonymous Coward | about 4 months ago | (#46875675)

Twitter is still 'cool', at least to stock traders.

Microsoft is... not.

Late to the tablet game... (3, Interesting)

Lendrick (314723) | about 4 months ago | (#46875417)

...and desperately attempting to avoid irrelevance.

That being said, there's some sense to the strategy. If it's true that they lost money on the original Xbox, then it's worked for them in the past. Selling products below cost is a good way to get customers, provided your product is good enough that they'll buy your next one at a price where you'll actually profit.

I don't personally see Microsoft tablets being taken seriously (the number of people I see on the internet who apparently like Windows 8 doesn't fit with the number of people I've met who like it in real life, which leads me to believe that they learned a lesson from Vista -- albeit not the right one -- and have seen the value in paying astroturfers to pad their failures a bit). But then again, I didn't expect the XBox to be a runaway success either, and it did just fine, so time will tell.

Fortunately there's enough competition in the tablet market among Apple and all the different Android manufacturers that Microsoft isn't likely to be able to achieve the level of lock-in that they have on the desktop market, which means that another viable tablet maker could actually be a good thing. So even though it's Microsoft, I don't wish them ill here.

Re:Late to the tablet game... (0)

Anonymous Coward | about 4 months ago | (#46875485)

Actually being late to the game was pretty much their only option if they wanted to sell their own hardware.
Had they been early in the game everyone would have screamed foul and antitrust lawsuits would have followed.

Re:Late to the tablet game... (0)

Anonymous Coward | about 4 months ago | (#46875527)

Microsoft doesn't make money off of the consoles, they make money off of the games (royalties). They make a pretty reasonable bet that none to few people will buy an XBOX and then not buy games for it.

I'm not sure what Microsoft is thinking with the tablets though. Maybe they were hoping for royalties from the Microsoft app store? Or maybe the purchase of Office 365 licenses.

Re:Late to the tablet game... (0)

Anonymous Coward | about 4 months ago | (#46875609)

...and desperately attempting to avoid irrelevance.

They have 6% of the market, that's more than the combination of all Linux-based desktop distributions ever had in the PC market and it is almost as much as the Mac has of the PC market. It was always going to be loss leader to be supplemented by their other services like Office and the fact that they are turning over so many in such a short time given how late they were to market shows that they are doing pretty well.

the number of people I see on the internet who apparently like Windows 8 doesn't fit with the number of people I've met who like it in real life

Same thing happened with iOS7 and the same thing happened with Unity. Most people are not interested in technology and just use it as a tool so when that tool changes obviously they hate it regardless of the benefits it may have if they adapted their workflow, people are averse to change. We saw it with Windows XP too, but everybody forgets that, now everybody loves XP because they are indoctrinated in its use and thats the same reason people dont switch to Linux. Ill bet that even with the supposed masses of hatred you see for Windows 8 that its marketshare will continue to grow, XP and 7s will slide and Linux & OSX will stay relatively static in comparison.

Re:Late to the tablet game... (0)

Anonymous Coward | about 4 months ago | (#46875639)

They have 6% of the market

So how come I've never seen a Windows tablet outside a computer store? i see people using Android, I see fewer people using iPads, I've never, ever, ever seen anyone using Windows on a tablet.

Re:Late to the tablet game... (0)

Anonymous Coward | about 4 months ago | (#46876013)

Enterprise market most likely - I know that we're looking at them for a specific class of highly mobile users. The Lenovo Helix is already in use and we're testing other products including the Surface Pro 2. Having a Windows OS - even at v8.1 - means easier integration with supporting infrastructure & systems.

Sure, other tablets including iDevices are available, however these are primarily considered as a supplementary device.

Re:Late to the tablet game... (0)

Anonymous Coward | about 4 months ago | (#46876535)

"They have 6% of the market

So how come I've never seen a Windows tablet outside a computer store?"

What's a 'computer store'?

I saw them in 2 or 3 television series, but I guess those weren't 'sales'.

Re:Late to the tablet game... (1)

Anonymous Coward | about 4 months ago | (#46875699)

...and desperately attempting to avoid irrelevance.

They have 6% of the market, that's more than the combination of all Linux-based desktop distributions ever had in the PC market and it is almost as much as the Mac has of the PC market.

Apple's 6% of the market consists of people who are willing to pay Apple the lion's share of the PC industry's hardware profit for the privilege of using premium gear. Meanwhile, people in Microsoft's 6% of the market aren't even willing to cover the hardware cost. Which 6% is more likely to pay for apps, OS upgrades, and new tablets 2-3 years down the line?

But they make up for it (0)

Anonymous Coward | about 4 months ago | (#46875429)

in volume!

Losing money . . . (1)

mmell (832646) | about 4 months ago | (#46875455)

. . . and still haven't managed to get a significant fraction of the tablet/smartphone market.

Breaks my heart! ;^D

there is only one alternative (2)

wardk (3037) | about 4 months ago | (#46875483)

Double production and halve the price!

Gates said it (5, Interesting)

Anonymous Coward | about 4 months ago | (#46875487)

Microsot can skew the market with billions of dollars and attack any market segment it wants, losing billions on the way. It can't compete directly against competitors initially, but can market the hell out of any product and leverage its monopoly in one area to destroy markets, competitors and fair competition in other areas. The US government Sherman Act is a joke. Microsot gained a predatory monopoly on desktop PC's, laptops, notebooks, and has tried to destroy consoles, the internet, online search, cell phones and tablets. The further it goes from its base, the riskier its proposition. It has destroyed the technology market in the US, and has damaged competition in that area for at least a generation.

Wow! (0)

Anonymous Coward | about 4 months ago | (#46875503)

Now that's what I call putting the customer first.

They make it up on volume (1)

Anonymous Coward | about 4 months ago | (#46875531)

They sell at a loss but make it up on volume. Oh, no, they don't.

Tieing desktop / sever OS to be the same as tablet (1)

Joe_Dragon (2206452) | about 4 months ago | (#46875589)

Tieing desktop / sever OS to be the same as tablet is bad as well.

Also Surface RT should not be there as it can't run X86 apps if you want to have the same OS for all at least make them so they can run other win32 X86 / X86-64 apps

Microsoft Losing (0)

Anonymous Coward | about 4 months ago | (#46875613)

Change your name to Microcosm. That's for coercing half the world into moving away from XP, and suspiciously reporting IE bug at just the most opportune moment. Then we get to watch mozilla move in at just the nick of time with Firefox 29? Tell me there isn't sum10wong here.

It all makes sense now. (1, Funny)

jtownatpunk.net (245670) | about 4 months ago | (#46875689)

I couldn't figure out why anyone would bother digging up all those old ET carts. But now it makes sense. They need the room to dump all these tablets. Especially then RT tablets. Especially.

Too bad because the Pro models are nice. I just don't need one. I've been on Android for a couple years and I've got no reason to change.

This is our chance... (3, Funny)

aurb (674003) | about 4 months ago | (#46875693)

to destroy the evil empire! If we buy enough surface tablets, Microsoft will lose all of its money and go bankrupt!

Re:This is our chance... (1)

Anonymous Coward | about 4 months ago | (#46875953)

You obviously failed economics 101..

Re:This is our chance... (2)

Kaenneth (82978) | about 4 months ago | (#46876199)

... which is why Sony disabled Linux on PS3s

People were buying the money losing consoles, but not buying the money making games and accessories.

windows 8 licence cost in total (0)

Anonymous Coward | about 4 months ago | (#46875733)

I imagine they are counting the cost of the windows 8 licence in the loss. It would give them tax relief to do so. That said, I'm writing this on an Acer Iconia tablet with windows 8, and I actually like it now that it is patched with the latest windows 8 updates. I'm looking forward to the start menu being returned though.

ATTN MS: You ain't got that kinda muscle any more (0)

Anonymous Coward | about 4 months ago | (#46875827)

You can't keep burning capital to weaken and thwart potential upstarts and competitors. I did some reading into the whole Windows 8 API fiasco and it looks like they've royally F'd up again. How can they expect developers to commit to their smaller market share when they keep jerking around their preferred APIs?

Poor Microsoft (1)

Anonymous Coward | about 4 months ago | (#46875855)

They're never going to me able to make it up on the volume.

Still overpriced (0)

Anonymous Coward | about 4 months ago | (#46875867)

Got one from China for $300, including the touch cover. And it probably costs less to manufacture, not more.

the surface has sales? (0)

Anonymous Coward | about 4 months ago | (#46876055)

no doubt this must be the pro, I haven't seen any RT stuff mentioned in ages... and I've yet to see a surface anything in the wild.

Dear Microsoft (1)

petrus4 (213815) | about 4 months ago | (#46876271)

When will Dr. Evil be told to clean out his desk? You might not have figured out who the company's main liability is, yet; but the rest of us have known for years, now.

By the way, Windows 8 sucks; and although I intended XP to be my last Microshaft operating system, (after which I would have migrated to FreeBSD) thanks to the UEFI standard that you and the rest of the consortium of corporate supervillains implemented, that is no longer possible for me. If I want to use FreeBSD at all on new hardware these days, and I want full hardware support, I'm stuck doing so in vmWare under Windows.

Insincerely yours,
Petrus

It's not that much. (0)

Anonymous Coward | about 4 months ago | (#46876341)

Considering they lost about four billion on the original Xbox to force themselves into the games industry, this seems like pocket change.

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