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Microsoft takes $900 million writeoff on its unsold tablet computers.
#1
It does not appear that very many people are interested in purchasing Microsoft's Surface RT tablet computer running Windows 8.
Most folks prefer Apple's iOS or Google's Android on their smart phones and tablets.

Quote:Microsoft's announcement that it's taking a $900 million charge on the Surface RT, its lightweight tablet, is a big embarrassment.

It reinforces a bad historical pattern of Microsoft struggling with hardware products. The Xbox took a long time to be profitable. The Zune was a failure. The Kin phones were a disaster.

Yet, despite the bad history with hardware , Microsoft's decision to make the Surface was absolutely the right decision.

Microsoft needed the Surface because the iPad was (and still is) quickly taking over the personal computing world.

Its hardware partners showed no inclination to produce a high quality piece of hardware running Windows software that would compete with the iPad.

Microsoft wanted to halt the rise of the the iPad with Windows 8, which is supposed to be a combo of tablet and traditional PC software. To showcase Windows 8, Microsoft needed one good piece of hardware with a solid brand.

Companies like Dell, HP, Lenovo, etc. were not building good Windows branded devices. They weren't putting their resources into good hardware the was on Apple's level. And they could not be trusted to create good new products for Windows 8.

Therefore, Microsoft had to make the Surface.

Reviews of the hardware were largely positive.

"I like it," said Walt Mossberg in his review of the Surface RT. "It’s a unique tablet, made of a type of magnesium with a feeling of quality and care."

David Pogue at the New York Times raved about the "spectacular" hardware design of the Surface RT.

Where Microsoft's Surface failed was in the software department.

Windows 8 isn't good. It's the wrong path for tablet computing.

Microsoft tried to cram a full-blown PC on a tablet. The result was a half-baked experience that didn't make anyone happy. As Matt Rosoff of CITE World said, " Microsoft was wrong: tablets aren't PCs. "

Microsoft has other issues, too. Its Windows Phone line has failed to catch on. The transition from iPhone to iPad has been natural, Microsoft would have benefited from something like it. Microsoft's marketing for the Surface was bad with goofy dancing ads. And its brand with consumers isn't strong.

Add it all up, and the result is Microsoft slashing the price of the Surface RT and taking a $900 million charge.

The charge is due to Microsoft cutting the price of the Surface to $350, down from $500. It has to account for the new price of the Surface inventory, plus other Surface related products and prices.

Microsoft says it remains committed to the Surface. It should release an updated version of the Surface this fall with new Intel chips that make it thinner with better battery life.

It's not giving up on the Surface, because it's the right idea. It needs a good piece of hardware for Windows 8. It needs to fix Windows 8, though, if it wants the Surface to sell.

source
Never underestimate the power of human stupidity.
- Robert A. Heinlein
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#2
That's because the Surface RT is a piece of crap that can't do a damn thing. It is practically useless. I'm not sure why they even made it. The Surface with Win8 isn't that bad, if you can deal with the nonsense of Win8, but the RT is totally pointless.
that those with no rights,
display the right to have no life, to have respect they must accept
a world commiting suicide
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#3
I'm not impressed with Windows 8. I have it on my new laptop and I don't like all the app tiles on start up. I use my laptop for work. improve office! connecting it to cloud for office 2013 was not a great leap forward. Microsoft has steady went down hill since the gov went all antitrust on Gates. the truth.
Fistfull of xanax
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#4
Microsoft has reduced the price on their Surface RT tablets from $500 to $350, which is $150 per unit.
For that price reduction to amount to $900 million, they must be sitting on at least 6 million unsold tablets.
But if one assumes that out of the $150 price reduction, only $100 represents reduced income for Microsoft,
while the remaining $50 would be reduced markup profit for the retailer, then there could be as many as 9 million units involved.
That is a lot of inventory.

Personally, I have not purchased a tablet computer yet.
But I might do so later this year.
It won't be a Microsoft one.
Never underestimate the power of human stupidity.
- Robert A. Heinlein
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#5
I usually try to avoid buying anything from Microsoft at all costs; which is why I have a PS3 rather than Xbox.

Speaking of which, if you have the desire to befriend me on PSN simply send a friend request to SystemFolder.
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#6
x box blows. Microsoft should stay out of the hardware business
Fistfull of xanax
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#7
I have to agree with you on that.

Read this: Microsoft's Xbox division has lost nearly $3 billion in 10 years
Never underestimate the power of human stupidity.
- Robert A. Heinlein
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#8
More bad news from Microsoft regarding its Surface tablets:

Microsoft Ate More Surfaces Than It Sold
Never underestimate the power of human stupidity.
- Robert A. Heinlein
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#9
like I said, everything was fine till the antitrust thing happened. they broke up the company into divisions and it went downhill fast.

they are really trying like hell to sell the Nokia 1020 Windows phone. I know it's Nokia but Windows phones get crushed in the market by iPhones, Samsung and HTC.
Fistfull of xanax
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#10
(08-01-2013, 05:00 PM)LannisterHater Wrote: like I said, everything was fine till the antitrust thing happened. they broke up the company into divisions and it went downhill fast.

Microsoft has never been broken up by any antitrust action.
The corporate division structure has been reorganized several times over the years, but it has always been there, and it does not have anything to with any litigation that has been targeted at Microsoft.
Internal divisions within the firm are arranged according to the preference of its senior management.

Microsoft's problem is that it has been unable to move beyond the desktop dominance of their best selling Windows and Office products into profitable market shares in other areas of computing.
Just about everything else they have tried has lost money, even in cases such as their X-Box series gaming consoles, where they achieved significant market share, and Windows server, where they also achieved significant market share.

In smart phones and tablets, they are just an also-ran that has basically become the joke of the industry.
Never underestimate the power of human stupidity.
- Robert A. Heinlein
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