Early Surface Sales Pitiful 251
Nerval's Lobster writes "Microsoft has earned $853 million from sales of its Surface tablets, according to the company's annual Form 10-K filed with the SEC. That's a bit of a disaster, to put it bluntly. Earlier estimates put Surface sales at roughly 1.5 million units; the $853 million figure reinforces that projection. By comparison, Apple sold 14.6 million iPads in its last quarter alone. Adding insult to injury, Microsoft spent quite a bit producing and marketing Surface. The Windows division's 'cost of revenue increased $1.8 billion, reflecting a $1.6 billion increase in product costs associated with Surface and Windows 8, including a charge for Surface RT inventory adjustments of approximately $900 million,' read the Form 10-K. 'Sales and marketing expenses increased $1.0 billion or 34 percent, reflecting an $898 million increase in advertising costs associated primarily with Windows 8 and Surface.' Overall, Microsoft's Windows division earned $19.2 billion in its fiscal 2013."
Marketing expenses (Score:5, Insightful)
In other words, Microsoft spent more money on advertising the Surface than they took in selling it.
Wasn't that expected? (Score:2, Insightful)
What, did someone think huge numbers of people would toss their IPads and buy a new Surface instead?
The market was already pretty well penetrated, and there was never any reason to believe that the introduction of a new product would increase demand.
MS Suffering from Legacy Effects (Score:2, Insightful)
Consumers & business have their share of distate for BSODs and other disasters that cause them to go to other devices.
Re:sick of windows at work (Score:1, Insightful)
As opposed to the "freedom" of apple?
Microsoft went in the wrong direction (Score:5, Insightful)
Re:sick of windows at work (Score:2, Insightful)
People have invested in iOS and Android apps, leaving little incentive to switch. Additionally, WinRT lacks functionality compared to Win32. Microsoft has become reactive and conservative, following what others do rather than leading. They had the opportunity years ago to shake things up with the Courier tablet, which was focused on content creation. The project was killed because Bill Gates wanted it to be a more traditional device that interfaced with Office.
Re:sick of windows at work (Score:5, Insightful)
Re:sick of windows at work (Score:4, Insightful)
Is the fundamental issue that people are sick of using shitty computers with shitty locked down versions of windows all day at work, so they don't want more of the same bullshit for their personal devices?
No, the problem is an inexplicable tablet interface on the new desktop OS and a tablet which seemed to be sold on the idea that it does absolutely everything that the laptop which you already have does in exactly the same way, not to mention it running that bizarre new interface people keep muttering about because it's apparently terrible.
Re:sick of windows at work (Score:5, Insightful)
Yes and No.
Joe Sixpack** doesn't give a damn about the lock-in per se (see also the iPad). They want something that has flexibility, durability and (apparent) speed packed into an easy-for-them-to-grok mobile interface. A pretty UI/graphics package is also a must. Note that the iPad does all of that - it doesn't come with an instruction manual, yet most non-techie folks can pick it up for the first time and do what they consider to be useful stuff with it in less than five minutes.
Surface RT OTOH? Pure fail in this department.
** sample size = one spouse, all my relatives, and a handful of non-tech friends. Your own mileage may vary.
Beats the crap out of XBOX sales (Score:5, Insightful)
Remember when the early XBOX sales looks so bad they thought it might drag Microsoft under?
I admit it, I was taken in by the early hype (Score:5, Insightful)
Re:sick of windows at work (Score:5, Insightful)
Re:sick of windows at work (Score:5, Insightful)
The fundamental issue is that people already have a choice of multiple shitty locked down tablets, for which they can get far more applications for just about the same price or less.
What reason does anybody have to buy a SurfaceRT?
Re:Microsoft went in the wrong direction (Score:5, Insightful)
The problem with the Surface RT was that it was best described by what it couldn't do.
"It's like iPad, but it doesn't run apps from the Apple store."
"It's like a Windows PC, but it doesn't run all Windows software."
"It's like a laptop, but you can't type on it in your lap.
Microsoft completely fucked up the marketing. If Surface RT came out three years ago, it would have dominated, but Apple and Android have already shaped user expectations. They created a device that runs a browser and MS Office...enough to cover 99% of computing use...and it has twice the battery life, half the weight, and a third of the cost of an comparable ultraportable laptop. It should have been a killer piece of gear, and the engineers probably thought they created something really special. Too bad Microsoft thought it would just sell itself in market where existing tablets had already gone the content-comsumption only route.
Re:sick of windows at work (Score:4, Insightful)
The last such platform?
So no other UNIXes still exist?
There are other POSIX compliant desktops available on the market not made by Apple?
It's a shitty brand (Score:3, Insightful)
Re:sick of windows at work (Score:5, Insightful)
In Microsoft's vision of the world, an electric drill would need a gas pedal, a gear selector, a brake, an ignition key, and a steering wheel because consistent interfaces are important (who cares if you can actually use it?).
Re:LOL you think so? (Score:4, Insightful)
Seriously?
From my experiences, and talking with friends, we ALL pretty much refer to the toilet as "the Library"...we all catch up on our reading while sitting on the can.
I figured it was just a guy thing, since most women I know have no clue why myself and my other male friends keep an assortment of reading material in the bathroom.
Don't get me wrong, it isn't being irregular or constipated, just that it does take more than 30 seconds to sit and shit...so, might as well catch up on reading while in there. And for so many of my married friends, it is a good opportunity for a little me time from the wife, as that that is the one place and time they won't try to follow them around.
Re:Marketing expenses (Score:5, Insightful)
Another thing to consider is that revenue isn't profit. Revenue doesn't include, for example, the cost of the tablet itself that was sold in each transaction, but rather how much they sold the tablet for.
I imagine that after R&D and physical hardware costs, they're probably operating at a pretty deep loss on Surface. I'm curious if that is both Surface Pro and RT or just the RT though.
I have had them all (Score:4, Insightful)
Apple locks you in - you do what Apple allows and forces, including some of the crappiest written software ever imagined (iTunes). That also forces you to pollute your desktop PC with more crap (iTunes).
Android & Apple hideous development environments. Seriously, yes they can do anything, so can machine language code written in hex, that is not the point. The point is Apple runs this proprietary disgusting mix of object oriented and non-object oriented legacy crap. Android uses a semi decent language (potentially) but surrounds it with a hideous never considered anything but command line crap they call a UI. It depends on a buggy, poorly designed open source IDE
Microsoft has a decent language, the best UI in existence, and arguably the best IDE, but you cant run anything but Internet explorer, you cant deploy it conveniently to your own machine, and certainly not to anyone else's. It's a 'me too' clone with all the bad parts and none of the good parts.
They let the people worried about money get in the way of making a good product, and the result is failure (serves them right).
Gates made MS at a time when he ignored the bean counters and made Windows despite OS/2, to be better, not more profitable. The profit comes automatically. When you force profit in over being a good product, the surface is what you end up with. R.I.P. MS, the good you will be missed.
Re: sick of windows at work (Score:5, Insightful)
Windows 8 may have the same interface on all devices the problem windows RT is simpler
Windows RT is windows that can not run Windows Programs.
It was doomed to fail for that reason. Apple might be swapping parts of the UI back and forth across devices for consistency. But apple never said IOS was OS XI
Re:Marketing expenses (Score:5, Insightful)
Yes, and how is that working for them? At this point it is hard to tell whether Surface of Windows 8 was the bigger fiasco.
Re:Marketing expenses (Score:4, Insightful)
In other words, Microsoft spent more money on advertising the Surface than they took in selling it.
I'm sure all those commercials showing people dancing (or finger painting) with their tablets were way more expensive to produce than ones showing people doing actual work -- if that's even possible -- on the tablets would have been. To be fair, I think the Surface/Windows8 commercials are entertaining and well done, but they don't inspire me to actually want/buy the products.