What’s Behind Microsoft’s Surface Tablet Price Cut?

Last week Microsoft CEO Steve Ballmer announced a reorganization of the company that shifts focus into the tablet and mobile sector. This week Microsoft announced a price cut for their Surface RT tablet, making it more accessible to consumers in order to penetrate a fiercely competitive tablet market. Microsoft expert Karl Volkman of Chicago’s SRV Network, Inc., weighs in on the price cut and the management revamp.

“Microsofts price cut of the Surface tablet is a pretty clear indication they are trying to increase their share of the tablet market,” says Volkman. “They are in direct competition with the iPad, and they need to gain some competitive advantage to keep up with Apple. Cutting the price was their best option and makes the Surface tablet more accessible to consumers trying to decide between the two products.”

The least expensive of the Surface tablets, the Surface RT with 32 gigabytes of memory, was reduced to $349 from $499. The same tablet with a cover that is also used as a keyboard is now $449, down from $599. The new prices are comparable to the pricing model of the iPad, which starts at $329 with its mini version.

“When Microsoft first introduced the Surface RT, consumers were still unsure of the Windows 8 platform and there were concerns over a lack of apps,” observes Volkman. “Now that they initiated the price cut, this will give Microsoft better competitive positioning in the market.”

Karl Volkman, the Chief Technology Officer of SRV Network, Inc. in Chicago, Illinois, is an IT Professional with over 30 years of experience.

Microsoft Admits It’s ’18 Months Behind’ With Windows 8 Tablets

The Register’s Paul Kunert reports that Microsoft’s Surface tablet and the wider family of the Windows 8 and 8.1 OEM “ecosystem” are 18 months behind where it “wants them to be”, but they will soon start to put the clamps on the iPad, a Microsoft UK director is claiming.

Kunert cites Janet Gibbons, Microsoft UK and Ireland director of partner strategy and programmes, saying that with the BYOD trend people want to be “productive at work, to be able to print and have a keyboard,” and the answer to that is Surface and “all the different form factors, all the different sizes that the OEMs are bringing to market”.

Windows tablets have a long way to go to catch up with iPad. Kunert notes that in Q1/13 they accounted for just 4.3 percent of global tablet sales with iOS and Android accounting for 46 and 43 percent, according to Canalys data, but that Tim Coulling, senior analyst at Canalys, says Microsoft was right to target Apple with respect to BYOD, claiming it was easier for enterprises to manage “out of the box,” adding that “The iPad is a personal device with fewer options in the enterprise,” and “Microsoft is picking the correct target by going after Apple because that is where the majority of enterprise tablet rollouts will be.”

Microsoft’s “iPad-Killer” Lost The Company $900 Million In Last Quarter

Cult of Mac’s Buster Heine reminds us that Microsoft claimed when it unveiled the Surface RT last year that the new device made the iPad and the MacBook Air obsolete. However, he observes that so far the Surface RT has been anything but an iPad-killer, and according to Microsoft’s financial results for Q4 2013, it’s losing them truckloads of money, the company taking a $900 million loss due to Surface RT inventory adjustments – the news coming on the heels of Surface RT prices being reduced significantly.

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