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Why Is Microsoft Setting More Money On Fire With Surface 2?

Posted by timothy on from the producers-was-a-prequel dept.

Nerval's Lobster writes "Never mind that sales of the original Surface totaled a pitiful $853 million in its first few months of release, or that the tablet failed to make Microsoft an up-and-coming player (or any kind of player, really) in the mobile-device wars: Microsoft's now rolling out Surface 2 and Surface Pro 2, which feature upgraded specs and accessories but no radical adjustments to the first generation. Why would Microsoft pour good money after bad? The answer could be outgoing Microsoft CEO Steve Ballmer, who late last year released a memo suggesting that Microsoft was evolving into a 'devices and services' company. 'There will be times when we build specific devices for specific purposes, as we have chosen to do with Xbox and the recently announced Microsoft Surface,' he wrote. 'In all our work with partners and on our own devices, we will focus relentlessly on delivering delightful, seamless experiences across hardware, software and services.' That meant Surface (then on the cusp of release) was clearly a harbinger of the company's future direction — and canceling the project after the first generation would have been a stinging refutation of Ballmer's strategy. By spending the money and resources on a second device generation, Microsoft manages to save a little bit of face, albeit at considerable cost. But imagine the hilarity that'll ensue if this second generation goes down in a huge ball of flames like the first."

3 of 616 comments (clear)

  1. XBOX? by a_nonamiss · · Score: 5, Interesting

    The XBOX 1 lost 4 billion dollars. It's now a solid market that Microsoft dominates. Why would they not use that same strategy here?

    --
    -Arthur
    Cave ne ante ullas catapultas ambules
    1. Re:XBOX? by Anonymous Coward · · Score: 5, Interesting

      The point is they took a market that was solidly held by a few companies and squoozled their way into it by throwing vast amounts of money and a few really successful games.

      Sony did this back in the 90s and may have been the template for Microsoft's success.

      The trouble is the mobile devices market isn't the same as the console market where you make a machine and let it ride for 5 to 10 years on software, this is a very fickle and expensive market to play in where if you aren't lumping features in every year you get considered dusty. If you lump the wrong features in you seem uncool.

      Microsoft can't treat the trendy throwaway electronics game the same brute force way, unless they want to bankrupt themselves...?

  2. Re:I seriously like my Surface Pro tyvm by geek · · Score: 5, Interesting

    Though I'm used to the default MS bashing here -- I have to wonder have many people have actually USED a Surface (esp the Pro) for more than 5 min in a MS store or at a friend's house?

    I have two sitting here in front of me. I had to build the win8 image to push out via SCCM for our enterprise. The Surface pro is fucking terrible. What's the point of it when you spend 99% of your time on the windows desktop instead of Metro?

    The entire device lacks focus. It doesn't solve a particular problem (although the multiuser aspect is nice on our domain).

    If the Surface disappeared today no one would care. I was actually hopeful as I'd like to see some competition in the market. The Surface however isn't it.