What does Microsoft’s Surface mean?

photo: Microsoft
Will Surface be a footnote in the long downward slide of Microsoft?

Microsoft has stated that they’re developing the Surface because their hardware partners have failed to innovate. Of course, one reason for that is that “the Microsoft tax” on every PC has left the manufacturers with insufficient margin to support R&D. (I’ve read that Microsoft makes more profit per PC — about $55 per unit — than anyone else. One result is that in an effort to juice up their margins, the manufacturers have loaded new consumer-class Windows PCs with crapware. (HP is the worst offender.)

The June 13 Surface “prototype” was obviously vaporware: there was no ship date, no price, and no hands-on trials.

I fear that the Surface is a bump in the road as CEO Steve Ballmer (Microsoft’s Ringo Starr) rides Microsoft downhill.

I give Mr. Ballmer and Microsoft credit: Surface will undoubtedly shake up the hardware manufacturers. But in the end, their lack of innovation is caused by Mr. Ballmer’s unimaginative management. What else do you expect of a sales manager with no technical chops who becomes CEO?

For the moment, Microsoft Office, Exchange, and Sharepoint remain entrenched in the corporate market, where they earn most of Microsoft’s net profit. How much longer will that continue? See my July 2011 article, Whither Microsoft?

Visit my website: http://russbellew.com
© Russ Bellew · Fort Lauderdale, Florida, USA · phone 954 873-4695

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2 thoughts on “What does Microsoft’s Surface mean?”

  1. Another good MSFT decision:
    Microsoft takes $6.2 billion charge, slows Internet hopes
    SEATTLE (Reuters) – Microsoft Corp admitted its largest acquisition in the Internet sector was effectively worthless and wiped out any profit for the last quarter, as it announced a $6.2 billion charge to write down the value of an online advertising agency it bought five years ago. The announcement came as a surprise, but did not shock investors, who had largely forgotten Microsoft’s purchase of aQuantive in 2007, which was initially expected to boost Microsoft’s online advertising revenue and counter rival Google Inc’s purchase of digital ad firm DoubleClick.
    (from yahoo.com)

    Like

    1. I don’t remember their aquisition of aQuantive.

      As long as Microsoft retains its large corporate accounts (and I see nothing serious on the horizon that could unseat them there), it will have a large steady stream of income. Yes, there will be small losses here and there, but nobody offers corporations what Microsoft does: server, desktop, applications, and communications software, all from one vendor. Corporations (at least the fat ones) and well-funded government agencies love Microsoft.

      Last night, PBS aired a June 25 Charlie Rose hour-long nterview with Bill Gates. The first half-hour centered on the Gates Foundation’s efforts to eliminate polio, malaria, etc, and compared India and China.

      Then Charlie asked Bill if he ever considered returning to Microsoft full-time. Bill replied no, he was pleased with Microsoft’s direction and proud of Windows 8 and the Surface.

      Like

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