[Tsts]

MS is not a startup, that can go by with a promising product. It needs massive amounts of sales and with the current strategy Surface is not going to get them. IMHO MS should allocate an enormous amount of money, like $20T, just to get market share. Sell Surface way under component value, stop the stupid non-business use licensing of Office, take the risk to secure long-term high volume contracts with component vendors.

One of MS problems is there are no high DPI tablet panels on the market now. Apple has prepaid for all non-Samsung production and Samsung is keeping theirs for their own tablets.

[cdh]

> MS is not a startup, that can go by with a promising product. It needs massive amounts of sales and with the current strategy Surface is not going to get them.

Out of curiosity, why do you assume the Surface needs to sell in huge volumes? If every single Surface is sold at a profit, and the Surface division is even slightly profitable for Microsoft, I don't see why it matters if they sell 10,000 or 10,000,000 of them.

To me it seems like the genius part of what Microsoft is doing is that Windows RT and/or the Surface don't actually need to succeed in terms of market share. They just need be taken seriously for long enough to drive down prices of Intel's x86 chips, so that Windows tablets have a shot against ARM tablets long-term. As far as I can tell, that seems to be working already. (Intel Atom Z2760)

They also have a massive Enterprise business, most of which will probably upgrade to Windows 8 eventually, buying them quite a bit of time to watch this unfold. Not to mention Xbox, etc. And of course, on top of all that, there is still the chance that Windows RT will somehow be a hit.... which would be even better for Microsoft, because it would end their Intel pricing problems for good.

To me, this seems like a decent plan for a software company that until now has only been losing relevance and market share. It’s a better plan than bleeding out cash selling super cheap hardware to gain market share (Amazon’s Kindle Fire), waiting too long to give up the dying cash cow as the market changes (RIM), focusing only on extremely high quality products while your company dies around you (Nokia), or killing off the consumer version of Office for no apparent reason (which is presumably profitable as-is).

[pgeorgi]

"MS is not a startup, that can go by with a promising product"

Only that they always do. There's some (older) running joke about how Microsoft products start getting useful/successful with version 3: Windows, Word (Word 6 being the 3rd major WinWord release), Internet Explorer, XBox.

The first few iterations often were "notable" at best (IE 1 couldn't even display images).

[mmariani]

I don't know why you're getting down voted because what you said just makes sense. I mean, that's what Apple did and no one can argue that they weren't successful.

Someone else who worked at MSFT made a comment one of these days saying that the reason why they don't react more appropriately is because they are 100% right on their vision for Windows.

Well, I think they're wrong. Time will tell.

[ewolf]

I agree that market share is important, but I think Microsoft will face some serious issues turning market share into profit. Both Apple and Amazon skim the profits off their huge ecosystem here, but Microsoft doesn't have any equivalent.