|Microsoft Slashes Surface Pro Prices|
|By JOANNA STERN (@joannastern)||Aug 5, 2013, 3:33 PM|
Microsoft's family of Surface tablets -- the Surface RT and Surface Pro -- were supposed to challenge Apple's iPad by providing a blend between tablet and traditional computers. However, sales numbers and recent price drops on the tablet indicate that Microsoft's strategy hasn't been as successful as it had hoped.
After dropping the price of the Surface RT tablet to $350 a few weeks ago from $499, Microsoft today announced that it will dropping the price of the 64GB Surface Pro tablet from $899 to $799. The 128GB version costs $899. Those prices are available now at Microsoft's owns store.
"We've been seeing great worldwide success with Surface RT pricing and keyboard-cover promotions over the past several months and are proud to offer Surface Pro at more affordable prices starting today," a Microsoft spokesperson told ABC News. "People who buy Surface love Surface, and we're eager for more people to get their hands on Surface and share their excitement." The Verge first reported the Surface Pro price drop.
It's clear from early numbers, however, that not all that many people have gotten their hands on the Surface. While both the tablets accounted for $863 million in revenue during the quarter, the Microsoft took a $900 million write-down due to unsold inventory and higher than expected related expenses. Microsoft has not announced how many units it has sold.
The reviews of the Surface RT and Pro tablets, including our own, knocked both the tablets for too many compromises. While the RT version is cheaper and thinner, it runs a version of Windows called Windows RT, which doesn't support traditional Windows programs. The Pro version runs all Windows programs and a full version of Windows 8, but it is thicker, gets only five hours of battery life and costs double the amount.
Beyond those issues, analysts argue that Windows 8 itself wasn't all that well-received and that also impacted the sales of the device, which were heavily marketed by Microsoft as two of the halo Windows 8 devices in television and billboard advertisements.
"Both products really suffered from the poor reception of Windows and even poorer reception to Windows RT," Ross Rubin, principal analyst for Reticle Research, told ABC News. "A lot of the challenge at this point is the consumer reception to Windows 8 and Microsoft trying to make the case for something being a tablet and a PC."
Apple has, of course, stuck to a different route. The company has kept its Mac laptops separate from its iPad line of tablets. Apple CEO Tim Cook has said combining them at the moment would be like meshing a toaster and a refrigerator.
"Clearly there are different companies on different sides," Rubin said.
Microsoft has said it plans to continue to release Surface products, implying to ABC News a few months back that a Surface laptop itself was in the works. The company also plans to release Windows 8.1 before the end of the year, which includes improvements to Windows 8, including an easier way to return to the traditional desktop with a new Start button.