) recently announced that it would expand the availability of its
Surface family of tablets to businesses, allowing customers to
purchase the devices from authorized resellers in the United
Earlier, Surface was available only through the Microsoft
Store in the U.S. and Canada. But now, a number of authorized
distributors (Ingram Micro, SYNNEX Corp and Tech Data Corp)will
sell the devices to authorized resellers, which will distribute
the Surface through their brick and mortar stores around the
world. These resellers include CDW, CompuCom Systems Inc., En
Pointe Technologies, Insight Enterprises Inc., PC Connection
Inc., PCM Inc., SHI International Corp., Softchoice, Softmart and
Additionally, Microsoft is introducing a new program called
AppsForSurface for independent software vendors (ISVs). Under the
program, Microsoft will provide devices and funds for
Surface-specific software development for their easy adoption at
enterprise, government and academic organizations. This move
could potentially boost enterprise adoption of Microsoft's
Windows 8 and RT tablets.
Microsoft Surface was launched worldwide on Oct 26, 2012, with
a price tag of $499.0, which makes it comparatively expensive.
Microsoft offers two versions of its Surface tablets to the
consumer, one with Windows RT and another with Windows 8 Pro.
According to IDC, only 900,000 Surface tablets were sold
during the fourth quarter of 2012 and the first quarter of 2013
and its market share was just 1.8%. In comparison,
) led the race with a 39.6% share of the worldwide tablet market,
followed by Samsung with a 17.9%share, and ASUS with a 5.5%
The addition of authorized resellers is just the latest effort
by the company to expand the availability of its Surface range in
2013. Last month, Microsoft reduced the price of the Surface RT
model to $199 from $499 for schools purchasing it directly from
Microsoft. In mid-December, the company added more retail outlets
from where its tablet could be sold. Further, Microsoft
transformed several holiday stores into permanent Microsoft
retail outlets. Most recently, it tied up with Best Buy to create
Windows Stores within Best Buy stores.
So far, Surface has been sold only at Microsoft stores and the
apps have focused on consumers and individual business users. But
this new move should help Microsoft expand its presence in the
enterprise segment, which has been its greatest support in the PC
Although Microsoft has fallen back in the tablet race, there
is still time to create its own niche. Combining the
functionality of a tablet and laptop, Surface can create interest
and attract new users. We should also not forget its deep
pockets, which gives it the power to conceive of and implement
strategies like AppsForSurface.
Microsoft is a late entrant in the tablet market and beating
the competition at this point will be an uphill task. Other
successful tablets such as Apple's iPads,
) Nexus 7, Samsung's Galaxy tablets and
) Kindle Fire already have a strong presence in the market.
The popularity of tablets has eaten into Microsoft's core
computing market, with the weak economic conditions making
matters worse. Given its dominant position in the PC market,
Microsoft has been one of the worst affected by this
Currently, Microsoft has a Zacks Rank #4 (Sell).
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