Mobile // Mobile Devices
Commentary
1/18/2014
09:06 AM
Michael Endler
Michael Endler
Commentary
Connect Directly
Twitter
RSS
E-Mail
50%
50%

Can Windows Tablets Break Out In 2014?

One lesson to date: While Apple can still command top dollar, Windows tablets only become widely desirable when they drop to Android-level pricing.

The same seems to be true among consumers. In addition to concluding that the Surface was Best Buy's top Black Friday seller, InfoScout found that Apple's $299 iPad Mini was the top seller at Walmart. Target's top three sellers were also iPad models, and all three sold for substantially more than Best Buy's $199 Surface fire sale.

The InfoScout survey is based on data captured from 125,000 North American users, which makes it a limited sample, but if it suggests anything, it's this: Whereas Apple can still command top dollar, Windows tablets only become widely desirable when they drop to Android-level pricing.

"We've seen that limited price promotions will often cause an uptick in sales for our other products," Eskridge said of the discounts, noting that although a Surface might lure a customer into the store, that customer might leave with the more expensive Surface Pro 2.

Between Windows 8.1 and new form factors, Microsoft and its partners did a lot of retooling to make Windows tablets more attractive. So far, the progress has been modest.
Between Windows 8.1 and new form factors, Microsoft and its partners did a lot of retooling to make Windows tablets more attractive. So far, the progress has been modest.

Does that mean Microsoft and its partners will convert some of the most aggressive discounts into permanent prices? Doing so could potentially boost shipment volume at the expense of margins, and perhaps, as Eskridge implied, increase the number of would-be customers who can be up-sold to costlier models.

"It was important for us to have an intriguing offer around such a busy shopping weekend," said Eskridge, not quite answering the question. "We knew we could generate some interest with the promotion."

Unfortunately for Microsoft, the interest doesn't seem to have extended far. On Dec. 30, InfoScout released new numbers that tracked U.S. retail spending between Thanksgiving and Christmas Eve. The 16-GB iPad Mini was the most-bought item during this span and other iPad models occupied the fifth, eleventh, and twelfth slots on InfoScout's list.

Microsoft scored a victory with the Xbox One, which ranked second. But only two Windows 8.1 devices placed among the top 15: HP's Pavilion TouchSmart 14 laptop, at number four, and Microsoft's 32-GB Surface, at 15. Based on these numbers, the Surface Pro 2 and Surface 2 supply shortages might have had more to do with constrained inventory than overwhelming demand.

Microsoft VP Panos Panay displays new Surface keyboard accessories at the debut of the Surface 2 and Surface Pro 2 in New York.
Microsoft VP Panos Panay displays new Surface keyboard accessories at the debut of the Surface 2 and Surface Pro 2 in New York.

The Chitika data paints a similar story. Yes, Surface tablets gained share while iPads lost some. But the survey still concluded that Apple's devices account for more than three-quarters of all tablet use. In this context, is the Surface's 2.3% share really a victory? It's like a basketball player who makes a flashy shot when his team is already down by thirty points -- notable, but ultimately not very important.

Previous
2 of 3
Next
Comment  | 
Print  | 
More Insights
Comments
Newest First  |  Oldest First  |  Threaded View
<<   <   Page 3 / 4   >   >>
melgross
50%
50%
melgross,
User Rank: Ninja
1/21/2014 | 11:52:02 AM
Re: Business sales?
Never said it was the Pro. The article isn't about the Pro, it's about Windows tablets in general.
melgross
50%
50%
melgross,
User Rank: Ninja
1/21/2014 | 11:50:55 AM
Re: Business sales?
The article here is "Windows tablets". It's not just about Surface Pro. The costs I was referring to aren't for the Pro, obviously. The photo in the article is for a Surface 2, which isn't a Pro model, but the new RT version. But, let's face it, the Pro tablets aren't selling well either. I've read that 7 million Windows tablets sold in 2013, but I don't believe a word of it. Most everyone I know has an iPad, some have Android models, and one person has a Surface Pro. In fact, I'm skeptical about every number except that of Apple. No one else mentions sell through, some don't even tell what their shipped numbers are, and it's all a matter of guesswork by the Microsoft friendly duo of Gardner and IDC. Microsoft is losing massive amounts of money on their tablets, and third parties aren't having a ball either. Now, there's talk of an 8" Pro, or equivelant from third parties. Are they kidding? The Pro is so difficult to use in the classic desktop mode already. And for RT, well, let's just say that there's no need for that in the eye of the consumer. Both Android and iOS already fill all the ecological slots for tablets, and RT offers nothing extra of note. That will be true no matter what Microsoft does about integrating the versions.
melgross
50%
50%
melgross,
User Rank: Ninja
1/21/2014 | 11:39:14 AM
Re: Microsoft needs to push an alternative vision of portable computing
You're not correct. The iPad is an excellent productivity device. I'm not the fastest typist, but I can manage 60 WMP on my iPad's virtual keyboard, and others tell me they can do better. That's fast enough for most anything other than for secretarial work. As companies are issuing iPads, they must feel as though they fit their needs just fine. Of course, iPads won't meet every need. But then, neither do notebooks.
SaneIT
50%
50%
SaneIT,
User Rank: Ninja
1/21/2014 | 7:38:08 AM
Re: Business sales?
I haven't seen a Surface Pro 2 at that price but I don't think that's what he was getting at.

I think one of the things holding back the Surface tablet line is the confusion between the Surface and the Surface Pro.  I will be replacing my laptop with a Surface Pro 2 shortly, but I would not buy a Surface with an ARM processor.  Part of the draw for me is having a full desktop OS and not having to juggle applications between devices.  I think in the future mobile OSes and desktop OSes are going to merge, Microsoft is the company closest to making this happen and the hardware is finally good enough for me to take the plunge.
rradina
50%
50%
rradina,
User Rank: Ninja
1/20/2014 | 6:08:31 PM
Re: Business sales?
I don't think it was the Surface 2 Pro selling for $199.  I think it was the first generation Surface (i.e. the Surface RT which I believe is now just called Surface 2).  I believe that version had the Nvidia Tegra or something like that.  It was an ARM processor, not an Intel.
Mekon
100%
0%
Mekon,
User Rank: Apprentice
1/20/2014 | 4:52:10 PM
Re: Microsoft needs to push an alternative vision of portable computing

The issue with iPad and Android isn't just the keyboards; if you plug a mouse, keyboard, and large screen into your tablet, you expect a desktop experience (something Microsoft has learned the hard way with Windows 8.x). 

OEMs might be able to do some devices like this using Android as the OS, but now the situation that Microsoft finds themselves in the consumption tablet market has exactly flipped; why on earth would anyone buy an Android device with a desktop-like experinece when you can get a Windows tablet that provides the full Windows desktop experience? The only advantage such Android devices would have would be price, but not by much.

You also want access to your desktop software, and only Windows can give you that. Granted, even with Intel's excellent BayTrail processors, the current crop of hybrid tablets isn't quite up to full desktop performance standards. But you can imagine in one more generation of SOCs from Intel, this will probably not be an issue. 

Full disclosure here:  I do NOT think the desktop is dead in any way; the desktop will be with us for information workers for the foreseeable future; obviously, the desktop/laptop computer market is pretty mature, so no big growth can be expected, but PC/Hybrid makers will continue to sell 100s of millions of units.

Brian.Dean
50%
50%
Brian.Dean,
User Rank: Ninja
1/20/2014 | 3:35:11 PM
Re: Microsoft needs to push an alternative vision of portable computing
I agree, as time goes by and PC sales continues to decline the need for a device that is productive (mobile or otherwise) will only increase. Mobile devices have experienced a lot of growth in recent times but to the most part they are only devices that can be used for consumption.

I think it would not require a very big leap for Android or ipad to start offering keyboards and display ports however, the advantage that Microsoft has is that Windows is accepted in the enterprise world. If performance is an issue then maybe DaaS becomes an offering. 
Brian.Dean
50%
50%
Brian.Dean,
User Rank: Ninja
1/20/2014 | 3:14:55 PM
Re: Business sales?
You make an interesting point about determining the price of individual components. It would be nice to have a breakdown of different types of screens at per unit cost, etc.

The prices of processors are readily available, so it is a good place to start. The Venue 8 Pro has an Atom Z3740D that has a tray value of $32. And the Surface pro 2 has an i5-4300U that has a tray value of $281. It does sound extremely strange that a product having a $281 processor alone is selling for $199...

Another point to take into consideration concerning the need for performance in a Windows based tablet is that Microsoft has recently started placing the i5-4300u processor in the Surface pro 2, instead of i5-4200u. 

 
Mekon
100%
0%
Mekon,
User Rank: Apprentice
1/20/2014 | 2:54:02 PM
Microsoft needs to push an alternative vision of portable computing

This article is great, really explains the challenges ahead for MS in the tablet market. 

First, the survey you mentioned where people view their laptop and tablet as separate things, this implies that they WANT to keep them as separate things. 

The fact is, the iPad is a terrible productivity device; next time you go to an airport, check out the people trying to use the iPad with a keyboard to do actual work, it will make your eyes water at how bad this experience is.  For these folks, it would be interesting to introduce them to a Surface 2 with a type cover, miles ahead of anything available on the iPad. 

Second, you are taking BYOD as a done deal in the enterprise. I have talked to several CTOs of large organizations, and they, to the person, _hate_ BYOD as a device strategy. The problem is, up to now they simply did not have much to offer as alternative. When your CEO comes to you with an iPad and says "get this on the network", this is a hard request to refuse if you don't present any workable alternative. This is just beginning to change with some of the newer Windows tablets, too early to tell if a real shift will take place or not. 

I do, however, agree that this productivity tablets will probably ultimately only appeal to a limited set of users, but I do think in the long run, this could be a perfectly decent market for MS and its partners. Maybe ultimately 10% of the tablet market? That would be just fine for MS, selling, as you say in the article, millions of units. 

I also agree MS is misguided in trying to compete directly against the iPad and low-cost Android devices.  It is hard to imagine someone going into Best Buy, looking over an iPad, Android tablet, and Windows tablet, and ultimately choosing the Windows tablet for a consumption device. 

Microsoft will lose if they continue to attack the "front gates" of the iPad and Android markets by trying to convince consumers to buy a Windows tablet for its entertainment/ media consumption chops. This is a losing game.  

MS needs to offer an alternative vision of what these portable device can be, and the only game left in town is to push a vision of a real productivity device you can hold in your hand, connect to keyboard, and also dock with your 24" monitor at your desk. The good news is that the iPad and Android simply cannot do this, they cannot compete here; MS and its partners have this, admittedly niche, market to themselves

Stratustician
50%
50%
Stratustician,
User Rank: Ninja
1/20/2014 | 1:45:00 PM
It's all about the marketing
I deal with the iOS vs Windows debate daily, and one of the biggest reasons I hear from customers and partners about why they still push iPads really comes down to messaging and simplicity. Microsoft and the hardware OEMs (in my opinion) still don't really push a strong value proposition to businesses.  We aren't being surrounded with the messaging that most organizations do indeed have a Microsoft infrastructure (Office, Windows, Exchange, SharePoint), and so working with technology that natively can allow workers to work productively across devices is a compelling message.  The problem is that there are so many devices out there, and just too much market noise in general.  iPads sadly sell more since there are few models to choose from, have a consistent experience and (sadly), they have good marketing.  

The other problem that I think is really keeping the platform from really taking off is that it's confusing for folks to configure.  I am still learning how to tweak my Windows 8 tablet.  It's the hybrid between having an application-based tablet and a traditional desktop that while powerful, can intimidate some folks.
<<   <   Page 3 / 4   >   >>
Building A Mobile Business Mindset
Building A Mobile Business Mindset
Among 688 respondents, 46% have deployed mobile apps, with an additional 24% planning to in the next year. Soon all apps will look like mobile apps and it's past time for those with no plans to get cracking.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest, Dec. 9, 2014
Apps will make or break the tablet as a work device, but don't shortchange critical factors related to hardware, security, peripherals, and integration.
Video
Slideshows
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
Join us for a roundup of the top stories on InformationWeek.com for the week of December 14, 2014. Be here for the show and for the incredible Friday Afternoon Conversation that runs beside the program.
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.