May 20, 2014

Microsoft Betting on Business Users in Surface 3 Introduction

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Microsoft introduced the Surface 3 today, a bigger, faster Windows tablet aimed at the business market. But Jay Yarow notes that the entire Surface venture has been a huge money sinkhole:

As a result, lots of people wonder what Microsoft is doing. Why is it even bothering to make the Surface? Shouldn’t it just kill the Surface?

The easy answer is yes, Microsoft should just ax its money-losing Surface business. But the correct answer is that it should continue to invest in Surface despite its early troubles. 

Microsoft’s Windows business is seriously threatened right now. The rise of Apple’s mobile software, iOS, Google’s mobile software, Android, and Google’s lightweight desktop OS, Chrome, have all diminished Windows. At one point, Windows was running 90% of personal computing devices; today it’s about 20%. 

If Microsoft doesn’t make the Surface tablet, there’s a chance no one will make Windows tablets. Why would Samsung, which has had massive success with Android, even waste its time with Windows? Why would HTC, or Lenovo, or any other company put significant resources toward Windows for tablets?

I don’t know if that’s true or not. It’s possible, in fact, that the competition from Microsoft has actually kept some tablet makers out of the market. Why even bother competing when one of the players gets the OS for free?

I won’t pretend to know which is true, but I sure hope Microsoft is guessing right, because I have a vested interest in Windows succeeding in the tablet market. I used an iPad for about a year, and then an Android tablet for a year. Then I bought a Dell Venue Windows tablet, and as I’ve mentioned before, it’s head and shoulders better than either one. As a longtime Windows user, I suppose my objectivity is suspect, but I honestly didn’t expect it to be very good. It is, though. The Modern UI is genuinely brilliant, and performance is smooth and fast even with an underpowered Atom processor. Add to that the fact that you can slap on a keyboard and switch to the desktop UI, and you have a tablet that can do just about anything.

Its big Achilles’ heel, of course, is the feebleness of its app ecosystem. I was pleasantly surprised that I had no trouble finding very nice apps for everything I wanted to do, but obviously that was just a bit of luck. There are plenty of apps you can’t get for Windows, and if one of them is an app you just have to have, then you’re out of luck.

In any case, I like my Windows tablet, but I know that its future success depends on selling lots of units. And that in turn depends on the availability of lots of apps. So I sure hope Microsoft is making the right call with its Surface product line.

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