Microsoft's Surface RT is Shaping Up to be a Train Wreck

Cue the hate mail telling me that I'm a dumb Apple fanboy or a prejudiced, clueless moron who doesn't get it, but I think that Microsoft's Surface RT is turning into a train wreck. Ironically, I don't think that the impending train wreck has anything to do with the Surface RT units themselves or with Microsoft's strategic decision to pursue consumer-friendly tablets. Instead, I think this looming disaster hinges upon poor execution from Microsoft's leadership.

Microsoft Needs the Surface to Be a Success

It doesn't require a degree in market research to see that PC sales have seriously slumped due in part to skyrocketing tablet sales in recent years. Although I don't think that this trend necessarily means that tablets are replacing PCs, it does mean that consumer money is currently going mostly to tablets. As such, Microsoft would be dumb to ignore these trends by not attempting a serious refresh that includes bringing Windows into the tablet trend.

I was smitten when Microsoft announced the Surface in June—not only because of how appealing the devices look, but also because it was great to see that Microsoft was aggressively pursuing this corner of the market. Fast forward a few months, and I increasingly started to worry about pricing and how glacially Microsoft was moving in delivering actual devices instead of promises.

Major Pricing Mistakes

Last week Microsoft unveiled the Surface RTwith pricing starting at $499 for 32GB models, which might sound spacious until you remember that Windows RT gobbles up 12GB of storage. Moreover, Surface keyboards cost an extra $129, which seems abusive given that the keyboard seemed so integral to what made the Surface a competitor in the tablet space.

Microsoft somehow decided that consumers would feel confident paying roughly the same price for unproven, first-generation Surface RT units as they would for seasoned, third-generation iPads. Only, the joke's now clearly on Microsoft because within one week of the company's pricing announcement, Apple unveiled its brand new fourth-generation iPads with Retina display for the exact same price as its third-generation predecessors.

As I opined before, I think it would have made a lot of sense for Microsoft to subsidize these devices to help drive adoption, gain footing in the tablet market, and spur developer interest. For example, Microsoft could have easily dropped these prices to $299 for five million consumers with the $1 billion in advertising that they're expected to shell out to promote the Surface. Instead, Microsoft has gambled that consumers will be drawn to the Surface, an unproven tablet, based on its merits alone. This strategy partially makes sense because one of the big benefits that the Surface offers is that it provides a full-blown Windows experience. However, that's another huge problem because the Surface RT actually doesn't provide that experience.

Surface RT: The Perfect Storm

Consumers expecting a power-user solution from the Surface RT are in for a very rude awakening. They won't be able to take their apps with them on the go with the Surface RT because Windows RT is really nothing like the Windows they know and love. With Windows RT, you can't run any executable files and you can't install your own software. Instead, all apps must be downloaded from the Microsoft Store.

Although Windows Pro devices will eventually provide the full-blown Windows experience that many Surface users are craving, Microsoft has done an insanely poor job of clarifying this distinction for consumers and its own sales personnel. I've actually seen highly technical consumers heave a sigh of relief upon being able to cancel their Surface RT pre-orders after learning that they won't be able to run RDP into other Windows machines from their Surface RT devices.

Microsoft Needs Better Communication Strategies

In my opinion, Microsoft needs to do a better job of communicating Windows RT's capabilities and limitations. Otherwise, anyone who buys a Surface RT and expects it to run their own apps is in for a very rude surprise—and currently a big appeal for the Surface is the idea of being able to take Windows apps on the go with a new, easier-to-use, tablet-centric device that runs Windows.

Couple the sour taste that this brewing problem is likely to leave in the mouths of consumers with the fact that these devices cost the same as iPads and I think Microsoft has done a very serious disservice to its tablet strategy. I don't think that this disservice is because of any particular limitation with the Surface itself; the problem can be attributed to Microsoft's poor execution for pricing and failing to uphold consumer expectations. Moreover, given current market trends, the fallout for this one-two punch that Microsoft has managed to land on itself will probably leave a mark that will take a while to rub out.

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