bit-tech.net

Microsoft dramatically cuts Surface RT pricing

Microsoft dramatically cuts Surface RT pricing

Microsoft's Surface RT family is now nearly a third cheaper than at launch, as rumours spread of an upgraded model waiting in the wings.

Microsoft has dramatically reduced the price of its Surface RT ARM-powered tablet world-wide, following slower than expected sales and rumours of a growing stock backlog which must be cleared out ahead of a next-generation device launch.

Microsoft's first entry into the tablet market as a creator of retail hardware, rather than of software and reference platforms for its original equipment manufacturer (OEM) and original design manufacturer (ODM) partners, the Surface RT was designed to showcase Windows 8's ability to run on the low-cost, low-power ARM processor platform. Based around the touch-centric Modern UI, previously known as Metro, there's no denying that Windows RT lends itself to a touch screen - and the optional Touch Cover, which doubles as a touch-sensitive keyboard seemingly styled after Sir Clive Sinclair's iconic ZX80, is a handy extra.

Sales of the device have, however, been slow. Windows RT, while perfectly acceptable as a tablet-centric operating system, has a serious drawback when compared to its parent operating system Windows 8: it provides no access to the classic desktop user interface, nor compatibility with existing legacy applications. As a result, those who are interested in a Windows tablet are either buying Microsoft's Intel-powered Windows 8-based Surface Pro or alternative x86 devices from rival manufacturers - and those who want the low power drain of ARM are going for non-Windows platforms like Apple's iOS and Google's Android.

While initial issues surrounding the device - including software bugs and manufacturing defects in the Touch Cover - have been addressed, sales have remained slower than Microsoft would hope. As a result, the company has dramatically reduced the price of the device - adding weight to rumours that a more powerful replacement is just around the corner.

Announced in the US over the weekend and now live in the UK, the reductions see the 32GB Surface RT drop to £279 while the top-end 64GB model hits £359 - reductions of over £120, or almost a third, compared to launch pricing. As before, the Touch Cover or Type Cover accessories are not included - adding a minimum of £100 to the cost of the gadget - while the Surface Pro devices, which include Intel processors and full-fat Windows 8 operating system, remain at their previous prices.

36 Comments

Discuss in the forums Reply
mi1ez 16th July 2013, 10:40 Quote
Still too expensive. IMO.
Cei 16th July 2013, 10:42 Quote
There'll be a new model coming, but it'll also be due to the complete lack of sales. I read somewhere that they've shifted only 900,000 Surface units,and that's units shipped from the warehouse rather than actually sold - http://www.infoworld.com/t/tablets/no-microsoft-didnt-sell-900000-surface-rt-tablets-212053.
Gareth Halfacree 16th July 2013, 10:42 Quote
Quote:
Originally Posted by mi1ez
Still too expensive. IMO.
It'd be worth it if you got the Touch Cover for free, I reckon - but having to pay another £100 on top for that when it's one of the only USPs the device has is a bit rich.
Stanley Tweedle 16th July 2013, 10:53 Quote
Microsoft will learn a hard lesson eventually. For decades they've been over-pricing their windows OS. £198 is the retail for win 8 pro. I bought it when it came down to a reasonable £24.99. That's still more expensive than OSX. Now microsoft are playing alongside apple and other tablet makers they will find their inflated pricing strategy hits them much harder.
FullThrottleRic 16th July 2013, 11:02 Quote
"has a serious drawback when compared to its parent operating system Windows 8: it provides no access to the classic desktop user interface"

Have you ever even used RT?! The UI is exactly the same as the x86 version, in fact the whole OS as far as the end user is concerned behaves exactly the same. The only proviso is that you can only install software from the windows store, which is no different from iOS.
rollo 16th July 2013, 11:16 Quote
Its major drawback is lack of x86 applications thats the surface rts problem and its why we will likely not see a second version of it ( + a few other issues lack of Advertisement, Lack of Apps on launch enough thats now fixed, Too pricey touch cover). That along with the total lack of sales that it has had will make sure this is the end of the Surface RT.

The Surface Pro has sold more than ( more than double if sales estimates are accurate) the Surface RT at double the price that alone will show Microsoft what people want to buy. Thats basically just in USA and Canada as the UK launch has been poor.
Stanley Tweedle 16th July 2013, 11:20 Quote
It seems like a seriously idiotic move making the "cheaper" surface non-x86. One thing Microsoft have in their favour (an advantage over their competitors) is a massive software base.. But they decided that wasn't important and they would create a new library of software post launch.
Cei 16th July 2013, 11:30 Quote
Personally, they should stop trying to compete with Apple with the RT and concentrate solely upon the Pro, which actually offers more of what people want.
Niftyrat 16th July 2013, 13:32 Quote
I am greedy looking to replace my release weekend 1st gen iPad. RT offers me nothing even at that price point at £99 I might have been tempted but i either will have a new iPad as that requires no messing around and I can use my existing apps or a full surface pro as that will allow me to do more on it.
Stanley Tweedle 16th July 2013, 13:41 Quote
Remind me of how much the pro costs again? Is it competitively priced? How is it on power consumption?

My iPad 4th gen cost me £360 direct from Apple laser etched with "iPad kicks google nexus butt" (it was a joke, I dunt really have anything against nexus, it's just that I need the iPad for the music making apps).
rollo 16th July 2013, 14:26 Quote
Surface pro has no tablet competition so its priced nice from my pov. Does not do brilliant on battery better than some worse than others.

Only reason I don't own one was the shoddy release in the uk.
Nexxo 16th July 2013, 14:49 Quote
Quote:
Originally Posted by rollo
Its major drawback is lack of x86 applications thats the surface rts problem and its why we will likely not see a second version of it ( + a few other issues lack of Advertisement, Lack of Apps on launch enough thats now fixed, Too pricey touch cover). That along with the total lack of sales that it has had will make sure this is the end of the Surface RT.

The Surface Pro has sold more than ( more than double if sales estimates are accurate) the Surface RT at double the price that alone will show Microsoft what people want to buy. Thats basically just in USA and Canada as the UK launch has been poor.

Actually a second version is already in the prototype stage.

But to correct people on the crazy sales figures that are flying about:

Surface RT units shipped: 2,000,000
Surface RT units sold: 900,000
Other Windows RT units sold: 200,000
Surface Pro units sold: 450,000

Google Chromebooks sold: 600,000
Nexus 10 tablets sold: 600,000
Corky42 16th July 2013, 15:28 Quote
So does that mean when the new version comes out and they still have around 1,000,000 left, that we can all get a free Surface RT ;)
Cei 16th July 2013, 16:12 Quote
Quote:
Originally Posted by Nexxo
Quote:
Originally Posted by rollo
Its major drawback is lack of x86 applications thats the surface rts problem and its why we will likely not see a second version of it ( + a few other issues lack of Advertisement, Lack of Apps on launch enough thats now fixed, Too pricey touch cover). That along with the total lack of sales that it has had will make sure this is the end of the Surface RT.

The Surface Pro has sold more than ( more than double if sales estimates are accurate) the Surface RT at double the price that alone will show Microsoft what people want to buy. Thats basically just in USA and Canada as the UK launch has been poor.

Actually a second version is already in the prototype stage.

But to correct people on the crazy sales figures that are flying about:

Surface RT units shipped: 2,000,000
Surface RT units sold: 900,000
Other Windows RT units sold: 200,000
Surface Pro units sold: 450,000

Google Chromebooks sold: 600,000
Nexus 10 tablets sold: 600,000

Source?
Nexxo 16th July 2013, 16:51 Quote
You can either assume that I make stuff up as I go along, or you can Google it yourself. ;)
Cei 16th July 2013, 17:02 Quote
It's just that my Googling says otherwise.

The IDC, in May, said that as shipments of its Surface RT and Surface Pro tablets combined for a total of nearly 900,000 units. Many of those units were Surface Pro, which the company started shipping to the U.S. and Canada in February. Microsoft has said that it is actively widening its regional distribution of both Surface RT and Surface Pro products. Beyond the Surface products, Windows 8 and Windows RT tablets continued to struggle to gain traction in the market. Total combined Windows 8 and Windows RT shipments across all vendors reached 1.8 million units.

So that's actually "nearly" 900,000 units of RT and Pro combined, with Pro outselling RT, by the end of Q1. Even if you're optimistic and double that for Q2 (noting that we've had a contraction in sales), you reach 1.8m units of RT and Pro combined. You, however, seem to have come up with a total of 2m RT units alone.


EDIT:
Apparently the split for actual sales (rather than shipped) of that 900,000 was 200,000 for RT.
fdbh96 16th July 2013, 17:32 Quote
Quote:
Originally Posted by Stanley Tweedle
Microsoft will learn a hard lesson eventually. For decades they've been over-pricing their windows OS. £198 is the retail for win 8 pro. I bought it when it came down to a reasonable £24.99. That's still more expensive than OSX. Now microsoft are playing alongside apple and other tablet makers they will find their inflated pricing strategy hits them much harder.

Apple includes OS price in the hardware. MS can't do this as they don't sell hardware, at least not very well :D

Also, very few people buy a retail copy of windows, as it mostly comes with their computer and the upgrade prices are cheaper.
RedFlames 16th July 2013, 17:47 Quote
Quote:
Originally Posted by fdbh96
Also, very few people buy a retail copy of windows, as it mostly comes with their computer and the upgrade prices are cheaper.

Most people don't even bother with upgrading, they just use whichever OS it comes with... Even amongst Mac users uptake of upgrade versions is relatively low... [and even at £14, i know plenty of people who pirated Mountain Lion]
Snips 16th July 2013, 17:59 Quote
Trust me, at this price SurfaceRT is a bargain. The x86 software issue is very minimal when used as it's intended, a tablet. With Office 2013 thrown in, for business it's even better. They're countless things you can use RT for that iOS or Droid can't do yet. I've used all 3 extensively and I find RT easier, faster and an all round smoother experience without the need to "app" everything.
Nexxo 16th July 2013, 18:18 Quote
Quote:
Originally Posted by Cei
It's just that my Googling says otherwise.

The IDC, in May, said that as shipments of its Surface RT and Surface Pro tablets combined for a total of nearly 900,000 units. Many of those units were Surface Pro, which the company started shipping to the U.S. and Canada in February. Microsoft has said that it is actively widening its regional distribution of both Surface RT and Surface Pro products. Beyond the Surface products, Windows 8 and Windows RT tablets continued to struggle to gain traction in the market. Total combined Windows 8 and Windows RT shipments across all vendors reached 1.8 million units.

So that's actually "nearly" 900,000 units of RT and Pro combined, with Pro outselling RT, by the end of Q1. Even if you're optimistic and double that for Q2 (noting that we've had a contraction in sales), you reach 1.8m units of RT and Pro combined. You, however, seem to have come up with a total of 2m RT units alone.


EDIT:
Apparently the split for actual sales (rather than shipped) of that 900,000 was 200,000 for RT.

The numbers get terribly confusing, even for the different gadget sites.

As I understand it, he 200,000 Windows RT units sold refers to those by other manufacturers. The IDC states that all five models put together (inc. Surface RT) have sold about 1,000,000 units (linky). Bloomberg reports anonymous sources stating that the Surface RT has sold a bit over a million, and the Surface Pro about 450,000.
Cei 16th July 2013, 18:31 Quote
You're absolutely right, it is confusing, and nobody seems to have a consensus. Bloomberg's report seems reasonable, but doesn't gel with the IDC's report from May about the Q1 sales - between them it seems to state that Microsoft struggled to sell RT in Q1, and this then reversed in Q2 to come out with the 2:1 advantage in sales that RT appears to have (900k to 450k) over the Pro. This would mean a lot of RTs sold this quarter, and hardly any Pros.

Regardless of the exact numbers (and MS's unwillingness to share is somewhat telling), it's pretty clear Surface has flopped in the tablet market. Apple sold 3m iPads in the first quarter of their existence, when everybody didn't know what to do with them, and they now sell about 20m of them per quarter. Microsoft obviously won't give up, and have a new revision on the cards, but is it enough to make the silicon a bit faster? I still think the £100 cost for the keyboard cover is too much.
fdbh96 16th July 2013, 19:09 Quote
You could just do it by common sense: I see loads of people with ipads and Ive never seen anyone with a W8 tablet let alone a Surface. Therefore, sales aren't good :/
Nexxo 16th July 2013, 19:21 Quote
That's why I mentioned the Nexus 10 sales number of about 600,000. If the Surface RT is a flop, what is the Nexus 10?

The Nexus 7 sales number is estimated to be 4.6 million. The twice as expensive iPad mini sold 10 million. Even when Asus sells its tablet at cost, it struggles to compete.

What this says to me is that it is very hard to break into the tablet market, which Apple has all but sown up.

Another interesting factoid is that the Google ChromeBook sold 600,000 units since its inception two years ago. The Surface RT managed to outsell it by 50% in its first quarter. Yet the Surface RT is labelled a flop, by the same tech writers who consider the ChromeBook a visionary and promising product, and particularly by companies like Acer and Samsung, which subsequently happily churn out another ChromeBook model. What does that say?
Corky42 16th July 2013, 20:16 Quote
The problem (if it can be called a problem) is that iPad's are seen as fashionable, and when it comes to be being seen in public having something that other people aspire to makes you feel special.
Its why most people buy designed brands and high end cars, people just like to show of :)
Nexxo 16th July 2013, 20:24 Quote
And to be fair, the iPad is an excellent product. It is almost flawless. The iPad Mini feels like something that dropped through a temporal wormhole from the future. I say this as a Surface RT owner.

Its ecosystem also has a six year head start. When the iPhone came out, there were no apps, but that did not bother people because all smartphones did in those days is offer PDA and email functions, and a (usually crappy) web browser. Apps were a bonus.

When the iPad came out three years later, there already was a wealth of iOS apps that were easily scaled up to the iPad. The ecosystem was already there.

The Surface RT tablet does not have that. It cannot tap into the myriad of legacy Windows software; it has to rely on the fact that Windows 8 is so ubiquitous that people will want to make Metro apps for it, and hence automatically for the Surface RT. But Windows 8 is ubiquitous on PCs and laptops, not on tablets. PCs and Laptops don't really need Metro apps. What can I say? Microsoft is a schizophrenic company, prone to schizophrenic reasoning.
impar 16th July 2013, 20:33 Quote
Greetings!
Quote:
Originally Posted by Nexxo
That's why I mentioned the Nexus 10 sales number of about 600,000. If the Surface RT is a flop, what is the Nexus 10?
There are a bunch of cheap 7-10" android tablets in the market. Nexus only is misleading as they usually more expensive.
Cei 16th July 2013, 20:50 Quote
Quote:
Originally Posted by Nexxo
That's why I mentioned the Nexus 10 sales number of about 600,000. If the Surface RT is a flop, what is the Nexus 10?

The Nexus 7 sales number is estimated to be 4.6 million. The twice as expensive iPad mini sold 10 million. Even when Asus sells its tablet at cost, it struggles to compete.

What this says to me is that it is very hard to break into the tablet market, which Apple has all but sown up.

Another interesting factoid is that the Google ChromeBook sold 600,000 units since its inception two years ago. The Surface RT managed to outsell it by 50% in its first quarter. Yet the Surface RT is labelled a flop, by the same tech writers who consider the ChromeBook a visionary and promising product, and particularly by companies like Acer and Samsung, which subsequently happily churn out another ChromeBook model. What does that say?
The Nexus 10 is also a massive flop - because I think the real demand is for the Nexus 7 and the iPad mini. When you're paying for the Nexus 10 you may as well just fork out for an iPad for little more, whereas the Nexus 7 is cheap and remarkably good. Slash the Nexus 10 pricing by £100 and I think it will pick up...but won't make money.

You are absolutely right that Apple have the tablet market sewn up - to a point. The Nexus 7 is the only weak point for Apple, hence it's reasonable sales, which means Apple have to up their game with the iPad mini in the future, and Samsung et al with, well, everything else.
Quote:
Originally Posted by Nexxo
And to be fair, the iPad is an excellent product. It is almost flawless. The iPad Mini feels like something that dropped through a temporal wormhole from the future. I say this as a Surface RT owner.

Its ecosystem also has a six year head start. When the iPhone came out, there were no apps, but that did not bother people because all smartphones did in those days is offer PDA and email functions, and a (usually crappy) web browser. Apps were a bonus.

When the iPad came out three years later, there already was a wealth of iOS apps that were easily scaled up to the iPad. The ecosystem was already there.

The Surface RT tablet does not have that. It cannot tap into the myriad of legacy Windows software; it has to rely on the fact that Windows 8 is so ubiquitous that people will want to make Metro apps for it, and hence automatically for the Surface RT. But Windows 8 is ubiquitous on PCs and laptops, not on tablets. PCs and Laptops don't really need Metro apps. What can I say? Microsoft is a schizophrenic company, prone to schizophrenic reasoning.

I think Microsoft should have looked at this fact a lot harder. The lack of a vibrant app store is massively harmful, and is possibly enough to sink a product. Should they have just accepted they were too late to the tablet party and not bothered at all? RIM are in the same situation - too far behind Apple and Android to catch up. The RT strikes me as a me-too product, coupled with Microsoft's typical inability to come up with a solid focus. The Pro on the other hand, bar battery life, is more what I would expect, and would welcome MS to continue development on in the future.

PS: Tegra 3? Really? Obsolete by the time it launched...
Nexxo 16th July 2013, 20:51 Quote
Quote:
Originally Posted by impar
There are a bunch of cheap 7-10" android tablets in the market. Nexus only is misleading as they usually more expensive.

Some of them are surreally cheap --and not even of poor quality. You can get some pretty decent 7" Android tablets for less than £125,--.

As for the Surface RT: I think that it is different enough to find its own market niche (it did for me --it is the first tablet I thought worth buying). The only stupid thing Microsoft did was lock the desktop. When you jailbreak it and run legacy programs ported to ARM on it, you realise that it is a pretty capable device.

Microsoft really had no other choice but to jump on the bandwagon, but its top decision makers (like Gates and Ballmer) are too bloody arrogant. They are too comfortable with the market dominance of Windows and Office and have started to believe that everything they do in that area is automatically going to be received like the second coming of Christ. At least Jobs understood that you are only ever as good as your last product.

I think that the sudden emergence and success of the iPhone and iPad, and the difficult birth of Windows 8 and the Surface has been a healthy wake up call for Microsoft.

PS: the Surface RT had been on the drawing board for a year; when it started the Tegra 3 was still quite new. The mobile market moves fast, and flexible Microsoft ain't. When the new Atom came out I would have pulled out all the stops and quickly redrawn the mobo of the Surface RT around that, even if it meant a three month launch delay. Think about it: a Surface RT but with legacy compatibility. It would have sold like crazy.
dancingbear84 16th July 2013, 22:31 Quote
Quote:
Originally Posted by Nexxo

What this says to me is that it is very hard to break into the tablet market, which Apple has all but sown up.

Nexxo I have to disagree with you here. The trouble is apple have1 operating system with 2 products. IPad and mini. Anyone buying an iOS tablet MUST buy one of them.
Android has multiple manufacturers at multiple price points and screen sizes.

I know of 0 people IRL with a tab running Windows.
I know of 2 people IRL with an iPAD
I know of 6 people IRL with an android tablet.
Similar stats for phones 1 windows, many iPhone, more android.

The trouble for MS on the phone and tablet market is that they have hit it too late. Either they need to firesale the stock HP style to improve market share, or sale at a price point that is attractive to buyers in the current economic climate.
I assume that those that can afford to spend >£250 on a tablet already have and therefore won't be in a hurry to upgrade. Those that can't afford it, like myself, aren't that relevant to potential sales. There are not many people left. They either have to be patient and accept that it will take time to get out into the hands of the masses or do something radical.
Nexxo 16th July 2013, 22:44 Quote
But that one OS is Apple's strength. If you scrape all Android tablets together, they may well reach a number on a par with all iPads. But then you have different versions of Android running on different screen sizes and resolutions... it is quite hard to develop for. Whereas with Apple, one App almost fits all. There are four resolutions to cater for: the older iPhone, the iPhone 5 with taller screen, the non-retina Apple iPad/iPad Mini, and the retina iPad. It makes the developer's life a lot easier.
dancingbear84 16th July 2013, 23:04 Quote
Definitely, i completely agree with you. The benefit of each approach is its demise and strength.
On the one had apple have a very simple setup as the available devices are so so narrow. It is great for consumers and devs, unless the one size fits all policy doesn't fit you.
Android by contrast offers a myriad of choices which is great for consumers, but not devs.
My point was more that if MS want to stick around in the mobile space, they need to be in it for the long haul. Or firesale the stock to get it out to people and start a buzz about the product. If it dropped to ~£100 or less I'd be very tempted. Until then I've got pc, laptop, netbook, smart phone, tablet. I really don't see what benefit the surface would be, over any of the above.
Nexxo 16th July 2013, 23:20 Quote
Totally agree. (OK, I'm worried now... ).

For me the Surface RT is very much an all-in-one device: tablet and laptop. A sort of Swiss Army knife. I think that it was a bit overpriced, but it was the closest thing to what I was looking for. Pricing it to match the iPad was arrogant --Microsoft just does not have that luxury. It should take Google's approach and sell them at rock-bottom prices, with touch covers going at cosy (£25,-- maximum). Never mind whether it upsets the OEMs.
rollo 17th July 2013, 12:03 Quote
lets be blunt there is 1 good andriod tablet thats the nexus 7, The rest suffer a tonne of issues that have stopped them ever selling in unit quantities to make them profitable.

Nexus 10 is too pricey and too close to an Ipad which people would rather be seen with.

Despite Apples share of Tablet market dropping in sales terms, They are still seen as the dominant company by many and are the only company making a profit on the tablet.
Nexxo 17th July 2013, 17:26 Quote
Apple is in the ideal position of being seen as the inventor of the tablet (yeah, I know, but nobody remembers the 2004 Windows tablet devices --and those who do, shudder) and of having a six year head start on apps --with a virtual monopoly on the market for the first year.

When you are a conservative buyer, you buy a Hoover vacuum cleaner, a Phillips light bulb, a Singer sewing machine. You go to the brands that are synomymous with the product. Similarly, you go for an Apple tablet.

And then there's the apps: six years' worth of app development; six years' worth websites making sure there is an iPad-friendly version. If there's an app for that, it's sure to be an iOS app. Six years of Apple accessories: in your car, on your speaker dock, on your HiFi system. It has acquired such a critical mass that Apple can just change the dock connector and people rather buy new accessories than move to another tablet.
fdbh96 17th July 2013, 17:45 Quote
Quote:
Originally Posted by Nexxo
Apple is in the ideal position of being seen as the inventor of the tablet (yeah, I know, but nobody remembers the 2004 Windows tablet devices --and those who do, shudder) and of having a six year head start on apps --with a virtual monopoly on the market for the first year.

When you are a conservative buyer, you buy a Hoover vacuum cleaner, a Phillips light bulb, a Singer sewing machine. You go to the brands that are synomymous with the product. Similarly, you go for an Apple tablet.

And then there's the apps: six years' worth of app development; six years' worth websites making sure there is an iPad-friendly version. If there's an app for that, it's sure to be an iOS app. Six years of Apple accessories: in your car, on your speaker dock, on your HiFi system. It has acquired such a critical mass that Apple can just change the dock connector and people rather buy new accessories than move to another tablet.

Another thing to bear in mind is that many people have taught parents to use iOS devices, and I sure as hell aren't going through all that again with an android. My parents are staying in the walled garden forever now :D
dancingbear84 17th July 2013, 19:34 Quote
The lack of accessories is a real shame about Android devices I think. I do like the fact that anyone can use any iPhone dockspeaker-me-jig with no fuss. I really would love to see accessories making use of BT or DLNA and having usb for charging or devices without BT or wifi. That would be great.

As for learning new things, people adapt and overcome, my dad did with android, he would probably cope nicely if thrown an iOS, or win mob too, at least with the basics.
Log in

You are not logged in, please login with your forum account below. If you don't already have an account please register to start contributing.



Discuss in the forums