Mobile Technology

Is Surface already flatlining?

Is Surface already flatlining?
Have Surface sales already flatlined? (partially sampled from Shutterstock)
Have Surface sales already flatlined? (partially sampled from Shutterstock)
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Despite slipping market share, usage statistics show the iPad still dominating (Dweider | Wikimedia Commons)
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Despite slipping market share, usage statistics show the iPad still dominating (Dweider | Wikimedia Commons)
Microsoft went all in on Surface and Windows 8, but customers haven't
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Microsoft went all in on Surface and Windows 8, but customers haven't
Have Surface sales already flatlined? (partially sampled from Shutterstock)
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Have Surface sales already flatlined? (partially sampled from Shutterstock)
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Microsoft pinned a lot of hope on Surface. The company fell way behind in mobile, and it hoped its own tablet would spark a monumental comeback. If web usage stats are any indication, though, the tablet's start can be best described as insignificant.

Analytics firm Chitika looked at tens of millions of (North American) tablet ad impressions from November 12-18. The Windows RT Surface barely registered, making up 0.13% of tablet web traffic. That means that out of every 10,000 tablet ad impressions, an average of 13 came from Surface.

It's still a new product, but this is hardly the start Microsoft wanted. It spent months hyping the tablet, marketing it as a new productivity-focused device. Steve Ballmer and company held two Surface keynotes, and spent millions in advertising. What happened?

Botched release

Microsoft went all in on Surface and Windows 8, but customers haven't
Microsoft went all in on Surface and Windows 8, but customers haven't

Pricing didn't help. Surface starts at US$500, the same as the iPad. If you want its keyboard – Surface's killer feature – add at least another $100. It's understandable that Redmond sees its tablet as an iPad peer, but customers have balked at buying non-iPad tablets in that price range. It's as if Microsoft didn't notice the Xooms, Playbooks, and Galaxy Tabs that had already failed with that strategy.

Its retail strategy bombed too. Microsoft sold the tablet exclusively through its retail stores (physical and online). How did that work out? So well that Microsoft just announced that it will soon begin selling Surface at additional retailers.

There's also the tablet itself. Its operating system is complicated, split into two desktop environments. It has a sparse app library. The device's display, battery life, and cameras are inferior to the iPad's. A kickstand and a keyboard clicking sound aren't going to make up for that.

iPad dominance

Despite slipping market share, usage statistics show the iPad still dominating (Dweider | Wikimedia Commons)
Despite slipping market share, usage statistics show the iPad still dominating (Dweider | Wikimedia Commons)

Chitikia's statistics are bad for Microsoft, but they aren't much better for Google. The Nexus 7 and 10 combined for over seven times the web traffic of Surface. That sounds good at first, but it still only makes up about 1% of tablet web traffic.

The iPad continues to dominate, with 88% of all tablet web traffic. Yet the iPad's global market share reportedly dropped to between 50-56% in Q3. There are two possible explanations for this discrepancy: a) rival tablets are more popular outside of North America, or b) after taking them home, customers use iPads much more than they use other tablets.

Trouble in Redmond?

Either way, the tablet market is still a steep hill for iPad rivals to climb. Microsoft was reaching for the sky with Surface, but the first battle has been a failure. Now Redmond is left to play the long game, and hope its Windows 8 Pro Surface (due in January) will fare better. Judging by its $900 starting price, its odds aren't looking much better.Source: Chitika via AllThingsD

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34 comments
Thomas Braum
It just seems like another me too product. Also, microsoft has gotten a reputation for buggy software. I have an iPhone, iPad, and a macbook pro. They all just work. I used to have PC's and had trouble with every one of them. Simply not stable.
S Michael
Dear Microsoft and Mr. Ballmer. In case you didn't know the economy is in bad shape, Let me tell you it is....people don't have the money and if they do they are not going to spend it on half baked products like this. I'm looking to find enough money to buy food let alone some stupid thing like this.
Trent Larson
I would not buy a surface just yet. The price point is way too high. I can't believe MS priced this the same as the Ipad. They should have sold these at cost or slightly below just to get them out. Bill gates used to supply dos for nearly nothing back in the early days just to get it on as many boxes as possible. Next year I expect the price to drop on the surface in a drastic way. Wait a little longer and you may pick one up at basement bargain prices if MS decides to discontinue it as a failed attempt to enter the tablet market. IMO only Apple can charge a premium. For everyone else its about price driven commodities. MS needs to keep it at levels at or slightly higher then the Android products. I have a Galaxy tab 2 10.1 that is amazing for 280 dollars. IMO surface needed to be priced at no more then 350 dollars. And even at that price, I'd rather have ICS galaxy or galaxy note. Its beyond me why anyone bothers with IOS with no real program manager or way to add memory with no XVID AVI flash support. I predict windows phones and tablets will go nowhere. MS will continue to sell W7 to businesses and W8 will probably lose more customers to Apple. Just like Vista did. Don't know what W9 will bring but something tells me MS will listen to us instead of just feeding us what they think we want. Only Apple is somehow allowed to to that.
John Comeau
judging sales by ad impressions? it may be valid, but questionable from where I sit. most of my gadget-freak friends use an Android tablet, even if they also own an iPad. never heard of Surface until now though.
Dylan Kemp
Is my maths wrong. IPad = been out 5 years = 10's of millions sold Surface = Out 1 month = how ever many sold Comparing 5 years of iPad users to a month of a new products website usage no wonder the figure is so low.
Gethin Coles
They launched too expensive. They should've launched at a break even cost, and made a bit in the surface pro. At this point market share is more important than profit. didnt they learn that from the xbox? Also releasing the pro version later: honestly a monkey could plan better marketing strategy.
Tim Parnell
Also bear in mind. The current Surface with RT. Everyone I have spoken to is waiting for the Windows 8 Pro version to come out before buying....
JuMo
I disagree, I have a Surface RT and love it. I never want to have to use a laptop again. It's a great balance between a consumer laptop and a tablet, without some of the limitations which other tablets have, The problem is that Microsoft have so far failed to get them sold via retail channels, it's a product people want to try before they buy. Everyone who's tried my Surface wants one. So far it's been bug free and is a great product.
Vince Pack
Speaking for myself (and I could be in the minority here), I have no real interest in the RT. it competes head to head with Android and iOS (the latter I've spent a lot of money on buying apps), and introduces yet another OS to buy into. I'm waiting anxiously on the Surface Pro. It'll replace my laptop and, with my planned transition to Windows Phone 8(x?) next year, will do me nicely.
I fail to understand why MS built such a nicely engineered product only to hamstring it with distribution. Maybe they lack the ability to produce on a scale comparable to Apple products? I don't know, but it was (is) a seriously bad move. I don't think the price point is too high, but I also don't see the logic in delaying the Pro, as it's mere presence will make the RT seem like a "better deal" for many.
MS - get the Pro out ASAP, put it on as many shelves as possible so we can see it, and let us finally have a reason to buy in!!
Who's with me??
Samer Helmy
The major number 1 reason it is flatlining, is that it simply is bad. Tried it, and it is no more than Windows Mobile platform on a bigger screen. The surface design and desktop layout is one of the most annoying, the random-coloured squares do nothing except infuriate you. There is no order or sense to that desktop, and Windows 8 is joining the stupid club. Windows 8 however has a point, this one doesn't.