October 31, 2014

Microsoft Drops Price of Surface RT Tablet Amid Disappointing Earnings

Microsoft Surface RT price drop

Microsoft yesterday announced disappointing earnings.  The software giant took a charge of $900 Million on its Surface RT tablets, and announced it would offer a $150 per tablet discount.

So if you’re in the market for a tablet, you can now get $150 off the price.  

Before the price drop the Surface RT cost $499. The 32 GB version (without the keyboard touch cover)  is now being advertised around the Web at $349. For instance, Staples and the Official Microsoft Store have it at the $349 sale price.

Amy Hood, Microsoft’s Chief Financial Officer, said Microsoft hopes the $150 discount will make the tablets more attractive to consumers and “accelerate RT adoption.”

The price drop does not affect the higher-end Surface Pro tablet, which starts at around $900.

The Surface RT runs the RT version of the Windows operating system, while the Surface Pro tablet runs the full Windows 8 operating system.  Windows RT differs in a number of ways from regular Windows 8.  The main thing to keep in mind is that it’s more limited. Software that works on earlier Windows versions won’t work on Windows RT.  

That means, the Surface RT won’t be quite as useful to business users who may require a tablet capable of being a desktop or laptop substitute.

For business users, the Surface Pro offers more functionality.  With the snap-on keyboard the Pro tablet can truly substitute for a larger computer.

Still, at a price just under $350, the Surface RT is competitively priced with other tablets of similar size. So if you aren’t too worried about using a lot of software programs on a tablet — and mainly want it for email, social networking and Web browsing — the discounted surface RT could be a good bet.

Microsoft has unsold inventory of Surface RT tablets that it needs to move.  VentureBeat writes, “While it’s easy to view this as Microsoft losing faith in the Surface RT, the price reduction is also a necessary step to clear out stock and make room for newer models. At its Worldwide Partner Conference this week, Microsoft noted that Surface upgrades are on the way this year….”

But don’t hold your breath waiting for discounts on the Surface Pro.  BusinessInsider quotes a Microsoft representative as saying Microsoft doesn’t have the same backed-up inventory with the Pro tablet.

12 Comments ▼

Anita Campbell - CEO


Anita Campbell Anita Campbell is the Founder and Publisher of Small Business Trends and has been following trends in small businesses since 2003. She is the owner of BizSugar, a social media site for small businesses, and also serves as CEO of TweakYourBiz.com.

12 Reactions

  1. As a convert from Microsoft to Apple several years ago I haven’t looked back. Every time I play with the Surface in the store, I think “Wow, it looks REALLY cool – much more innovative then an ipad”, but then when I actually try to use it and do anything on it, it turns out to be a very clunky user interface. Pair that with a lack of apps for it and you have a non starter. Now, if Microsoft dropped these to $249 I’d buy one just to play with it and see if I can make myself love it but for $349 or $499 forget it.

    • Hi Rob, I think you’re like a lot of people — there are a lot of loyal Apple fans. :)

      Personally I’ve never gotten into the Apple thing, beyond my Touch which I use strictly for entertainment (books, music, video). “But to each his own.”

      I have a Google Nexus tablet, which I absolutely love, but it’s not really a substitute for my regular computers. So as much as I love it, it is best used for Web browsing, social media and email — again, limited in scope. You can’t work with a PowerPoint on it, and without a keyboard and true mouse, it’s laborious to compose and write articles.

      There is a lot to be said for having a tablet that can work seamlessly with your business computer, and substitute for short bursts for a non-mobile desktop or a heavy-to-lug laptop. For that, you’d probably need the Surface Pro – not the RT.

      – Anita

    • Rob, the interface does have some issues, just like the ipad does. But, once you learn to use it, I have found it much more intuitive than my ipad and my Galaxy note. It takes a lot more use than just playing with it in a store. The one thing I have noticed too is a lot of Apple fans will try and hold the Surface at a higher standard than the ipad just so they can list its shortcomings, even when the ipad hasn’t ever had those features. Double standards.

      I do however think that the Surface has a different use than most other tablets. Most Android tablets and the ipad are more driven towards home use to use to watch Netflix, Vudu, etc. and surfing the internet while the Surface is more business driven. If you are a home user, any of the 3 OS’s will do what you need them to do. I am a Sys Admin and am on call every other week. I tend to grab my Surface more than my other two for work as it plays well with other MS products.

  2. Vinod Ramaswamy

    I’ve been using the Surface Pro for a few months now and the product is absolutely amazing. The only downside I see of it is the limited memory (128GB). Otherwise, it runs all my apps and works very similar to a PC with touch and inking capabilities. Annotating powerpoints during presentations, writing notes on OneNote is a breeze. I do not understand why Microsoft keeps trying to market the RT when Pro has potential to be such a big hit and change the market. I think this is a case of marketing strategy gone wrong.

    • The Surface RT supplements a desktop fairly well. It can run all the metro apps the Pro can. Of course it will never match up to the pro but it wasn’t designed to. When I leave my desk at work, I don’t want to bring my whole computer with me, just my e-mail, the ability to use Office, and Remote Desktop which the RT does quite well.

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>



Compare your business to the industry - Try our new tool