Ballmer: Don't expect Surface to be the "cheap option"

Ballmer: Don't expect Surface to be the
It's hard to believe that nearly three months have passed since Microsoft introduced the Surface tablet. During those 90 days, we learned nothing more about the two different variants of the product, including pricing. From the consumer's standpoint, it is always good to know the price of a device that you plan on buying as early as possible. This way, you can start panning where the money is coming from to buy it, (Let's see, if I sell my old tablet and my Microsoft KIN ONE, I might have enough, or perhaps I should just sell that Monet hanging on the wall for money to buy the device) so you can be prepared.
Microsoft CEO Steve Ballmer sat down with the Seattle Times the other day to discuss various things, including the upcoming Microsoft Surface tablets, and said that the Surface tablet has the elements of success despite the fact that the device has yet to go on sale. Ballmer gave away Microsoft's marketing strategy by saying that the Surface tablet can compete with the Apple iPad on features. That obviously means that the Surface will nor, as the CEO says, be "the cheap option."

We get the idea from the interview that Ballmer hates selling at the low-end of any market. Low-end products are chintzier, look cheap and do less, according to the executive. As an example, he mentioned that the 7 inch Amazon Kindle Fire  is not a good enough product to do homework on, but it is good enough for reading a book. From the CEO's comments, we would expect Microsoft to be more concerned with the bottom line than the top line. In other words, don't expect the Surface tablets to be low priced in order to obtain market share. The aim here is to grab a substantial profit margin, going against the usual "defend your market share at all costs mentality. Remember, there will be two models of the Surface tablet one running on Windows 8 using an Intel Ivy Bridge chip produced using the 22nm process and the other powered by an ARM based processor. The pair is expected to launch on October 26th.

source: SeattleTimes, via Gizmodo

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59 Comments

1. XPERIA-KNIGHT unregistered

"If you say to somebody, would you use one of the 7-inch tablets, would somebody ever use a Kindle (Kindle Fire, $199) to do their homework? The answer is no; you never would. It's just not a good enough product. It doesn't mean you might not read a book on it.." no we wouldnt but we would indeed use a nexus 7 tablet to do our homework! dude apple is over priced and always has been..............go to ebay and see that their FIRST generation ipad is still 400 plus dollars..........THEIR FIRST GEN! are you kiddin me?

3. PapaSmurf

Posts: 10457; Member since: May 14, 2012

I don't think there's something that the Nexus 7 can't do. Its a jack of all trades for $199. What a steal.

55. cepcamba

Posts: 717; Member since: Feb 27, 2012

There's something the Nexus 7 can't do. The Nexus 7 can never ever make a crap out of itself.

15. Gawain

Posts: 438; Member since: Apr 15, 2010

The MS Office environment is a real winner for students though. With OneNote, I can prepare anything, and convert/send to anything/anyone. It's also mature and does not have any of the buginess that still plagues the Android ecosystem. Of course I'm biased in my view, but my Fujitsu Lifebook with Wacom Penabled is absolutely stellar in the classroom or meeting environment. I'm really looking forward to seeing the seams that are gapped with Windows Phone 8, Wndows 8, and the MS Office experience. ;-)

26. XPERIA-KNIGHT unregistered

"It's also mature and does not have any of the buginess that still plagues the Android ecosystem." http://www.youtube.com/watch?v=bNkwVa-jp_g&feature =related lets you know how far android has come enjoy :)

45. meowcenary

Posts: 187; Member since: Apr 13, 2012

I love Onenote, and agree it is a very good productivity suite.

44. meowcenary

Posts: 187; Member since: Apr 13, 2012

I would not be using a tablet to do my homework. I still prefer a desktop, laptop, notebook/subnotebook, and a netbook. As for Steve Balmer, he needs to go. I have seen lots of good young execs, leave because of him. His moves are not doing MS any favors, with him on the helm. The killing point for the surface would be the price tag. The damn thing is a multi-media device versus a productivity device. Selling it high would not help them, nor cause people to flock to said device.

57. Jimstar

Posts: 259; Member since: Oct 24, 2011

what exactly is it the Fire lacks that the Nexus has that enables it to be better at that sort of thing? People keep saying the Fire won't be as good for this or that, but I honestly can't tell what it's lacking in order to be a sufficient productivity tool. I mean hell when it comes to homework, if I can access google drive through the browser then I can type out a word document. Hell I could even be stupid and download an Office clone from the amazon app store(just checked it on my phone, found 3 at a glance). Its got bluetooth so mouse and keyboard compatibility isn't a problem...I mean I don't see a problem. I'd probably get something else, but that's because I don't use Amazon nearly enough to have a use for it and be stuck with that UI, not that I can't do everything i'd need it to do.

2. PapaSmurf

Posts: 10457; Member since: May 14, 2012

That Ivy Bridge processor is going to make that Surface tablet fly.... I hope it succeeds. Consumers need options, and I think this is a good one.

4. good2great

Posts: 1042; Member since: Feb 22, 2012

He's right... Windows doesn't need to be the "cheap option"... you get what you pay for... don't agree with all of his views and directions of the company but this statement and approach I respect. and i believe once people spend that cash on a Surface they will be blown away with the quality of the hardware and software of their device.

48. Whodaboss

Posts: 176; Member since: Nov 18, 2011

I logged in just to give you a "thumbs" up!

5. drahmad

Posts: 480; Member since: Aug 20, 2011

they have already sold one to me, no matter how high is the price

56. cepcamba

Posts: 717; Member since: Feb 27, 2012

How did you purchase one?

58. Jimstar

Posts: 259; Member since: Oct 24, 2011

Good, because it'll be 2 million GBP(or 3244800 USD, whichever you prefer). Your left arm, and first born child's chastity! Also the right to drive a car that doesn't have squeaky brakes and an engine that doesn't have an uneven idle. Enjoy your surface!

6. techguy22

Posts: 227; Member since: Aug 09, 2012

LOL well good luck with that. i knew windows 8 was just gonna fail miserably just like windows 7. and MS wants marketshare. lol now we have 199 N7 and 199 KF. there are no way windows 8 gonna take on apple or android if they dont have good price point.

10. PapaSmurf

Posts: 10457; Member since: May 14, 2012

I actually like W7. XP is the best by far though.

12. Veigald

Posts: 290; Member since: Jan 13, 2012

Yeah, windows 7 sure was a miserable fail alright. How much did it sell so far, like 500 million or something? Miserable!

43. nwright94 unregistered

Other than the nexus 7, most android tablets are lousy. Right now in the tablet market, android isn't exactly winning. The kindle fire and nexus 7 are probably the only android tablets sold in high volume. Possibly the galaxy tab 10.1. Other than that, android is not what people usually want when they go to buy a tablet. I have a feeling windows 8 will push android to the bottom of the tablet market unless everyone starts making nexus 7 like devices.

60. Jobes

Posts: 364; Member since: Oct 27, 2011

AVATAR THIEF!

7. Dr.Phil

Posts: 2340; Member since: Feb 14, 2011

I don't think Ballmer understands that not all tablets offered at $200 are "chintzy" looking. The Nexus 7 is a beautiful looking device, and Google is selling it at around $40-$50 more than it costs to build. This enabled them to get some kind of cash flow while also increasing their market share. If Ballmer prices the Surface at $500+, they will sell pretty much next to nothing. Consumers are still unsure of Microsoft as a maker of tablets instead of well-known OEMs like Samsung or ASUS. If they price it around the same price that the other manufacturers are going to be pricing their Windows 8 tablets then I can't see that many people picking Microsoft over the other ones. If they price it even at $400, then you will be competing with Android tablets in that range as well as the mindset of consumers that may be thinking "Well, if I spend just a little more money I could get..." That is why I think Microsoft needs to sell their tablet at $299. It would set them apart from the $199 tablet crowd while also setting itself apart from the tablets in the $400-600 range. Consumers wouldn't think it was too cheap, but they also would admire that it offers a lot for a good price. In the end, it's their choice. Either they can offer it at $299 or they will suffer the consequences once the rumored Nexus 10 tablet is introduced for probably the same $299 price.

9. XPERIA-KNIGHT unregistered

bravo....bravo! very good perspective my friend and that 299 mark will do just what you said, show that they are not too cheap and as well provide enough features and performance to keep up with the higher end tablets......very reasonable perspective and logical at that

11. PapaSmurf

Posts: 10457; Member since: May 14, 2012

Well written. If its overpriced, not many people would buy it. But then again, we have the iPad...

46. meowcenary

Posts: 187; Member since: Apr 13, 2012

Hence the need to price it at a price point that consumers would notice or at least be curious. Also MS needs better PR for their products. Without it, just tossing a price point out their would not win them anything.

49. Whodaboss

Posts: 176; Member since: Nov 18, 2011

Over priced? Is relative. If you think $499 is too much, then it's too much for you (or anyone else who thinks it's too much). But I on the other hand think that would be a very reasonable price if the product lives up to expectations. And I will purchase one at that price. More importantly, like I always state this is a consumer market. It's your choice to purchase what you like and what you can afford. Mr. Balmer believes his product is superior to the other products available. The consumers will eventually change his mind on that or reward him for that train of thought. At this moment, based on what I've seen and read a Surface is one product I'm waiting to purchase regardless of price - of course that's providing it's not $699.00 or more.... ^_~

14. max9777

Posts: 78; Member since: Dec 11, 2011

But you also have to look at it from this point, I grew up on MS, I have a macbook air that's covered in dust, laptop is amazing, turns on fast runs great, but I just don't like mac OS. It's all about personal preference. MS still leads the world with PC's, because it has been there for ages. People will buy the tablet even if it is $500. If people did not buy MS products OEM's would not be releasing all these products every month.. Personally I think Surface would do great in sales, maybe not as strong as apple, but the tablets will sell. For decades MS and Apple were in competition and it's good too see that MS jumped on the hardware wagon rather than just software. Maybe now if MS does things properly they will lower the price of their OS, and start leading the production in great hardware, they will succeed

25. Owlet

Posts: 450; Member since: Feb 21, 2011

I personally don't agree, Dr. You're thinking about yourself, but maybe MS simply can't afford to sell that cheap. Sounds like they're not going to save on anything. The other thing is - some people actually do want to buy expensive high quality stuff. And they won't even consider all those cheap options you are talking about. I agree, they are not the majority, but do you always have to cater to the average Joe agonizing over the price and how he can swing it? I don't see Mercedes, or BMW, or even further, Ferrari, Maybach and so on going out of business. I also disagree that people won't choose over some established Android brands. It's Microsoft, it's not like some Oppo nobody ever heard about. I personally think the tablets will finally actually become functional. They aren't right now, you have to agree. They're fun toys to play with, but you constantly run into all kinds of limitations and inconveniences for it to be a true business tool. MS will change that.

28. XPERIA-KNIGHT unregistered

its your opinion indeed but if they dont make the price at a balance jus know their sales wont get very far with the competition out there

8. threed61

Posts: 259; Member since: May 27, 2011

Of course if there are two high end options, consumers are likely to buy the one with the most apps and services, which would be the iPad. They need to get the price down on the RT. They'll also need to demonstrate that people who don't post on tech blogs actually want a tablet running full Windows.

13. RomeoJDR

Posts: 245; Member since: Dec 09, 2011

HP tried entering the tablet market with a price comparable to the iPad and it failed. Blackberry tried entering the tablet market with a price similar to the iPad and it failed. Android manfacturers entered the tablet market with comparable iPad pricing and they failed until later when some realized the need to offer a quality cheaper alternative to the iPad. And, what have Windows phones done up to this point? Failed.

17. speckledapple

Posts: 902; Member since: Sep 29, 2011

Not sure about windows phones as that is still to be determined but your right about some of the other players. HP just produced a poor tablet while although the Playbook was not poor it has missing features that should have been standard. Both companies failed because they simply responded with a substandard product rather than produce something that would be ample for competition. I do not think Microsoft will make the same mistake in this case as Win * definitely has the features to go toe to toe with any tablet. Besides it is a full os in comparison.

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