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IDC Says Microsoft is Building 3 Million Surface Tablets

By - Source: CNet | B 11 comments

Microsoft has high hopes for the Surface.

Microsoft's Surface tablets don't launch for another two months but the company is obviously expecting huge demand. CNet cites an IDC analyst in reporting that Microsoft is expecting to build three million Surface tablets -- and that's just for this year. Yes, the Surface is launching at the end of October, and Microsoft is apparently building three million for two months of availability.

So the plan is to ship a few million units before the year is out, but Microsoft said earlier this year that the Surface would only be available through its own brick and mortar retail stores. According to IDC's Bob O'Donnell, that's going to have to change if Microsoft wants to shift millions of units.

"If they build a few million units there's no way they can sell it through Microsoft store only," he told CNet. "So I think that they'll sell it through traditional retail also. You can't build that many products without having a much wider distribution strategy. They just haven't shared that [strategy] yet."

Microsoft's Surface is scheduled to launch October 26, the same day as Windows 8, but Microsoft has yet to announce pricing for either the Intel- or ARM-based models. Recent rumors have suggested the Windows RT version could sell for as little as $200. O'Donnell says it's possible that Microsoft may work out a deal similar to the $99 Xbox, where customers would pay $199 and then an additional fixed amount every month for some kind of service, but he doubtful of this theory.

If Microsoft is hoping to shift million of Surface tablets in the first few months, the pricing is going to have to be very aggressive. Perhaps Microsoft plans to offer subscription-based pricing, or partner with carriers to subsidize 3G-equipped versions of the tablets. Perhaps the company is going it alone and will really offer the Windows RT for $200, no strings attached. We'll know for sure when Microsoft finally starts talking about prices.

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  • 3 Hide
    mcd023 , August 21, 2012 4:57 PM
    I just figured I'd be buying from Amazon or Newegg.
  • 4 Hide
    Krazeee , August 21, 2012 5:50 PM
    I'm pretty sure they'll sell via retailers, If its $200-$300 with Windows 8, then call me a happy customer.
  • -1 Hide
    gmarsack , August 21, 2012 5:54 PM
    If the Surface sells the x86 version for 200-300, I'll buy 2!
  • 0 Hide
    Anonymous , August 21, 2012 6:06 PM
    "or partner with carriers to subsidize 3G-equipped versions of the tablets" there is no Surface tablet with 3g, not even 4g... wi-fi only...
  • 0 Hide
    CaedenV , August 21, 2012 6:20 PM
    3 Mill tablets
    /
    365 days (assuming a 1 year product cycle until surface 2)
    =
    8,219 sales per day for a year, and (assuming an American audience) would be ~1% of the population owning one.

    That is a might bit optimistic for a 1st gen device... especially for a company that only has 31 retail stores to show it off in. I mean, I would love to have one... but I am hoping my WP8 phone would make it so that I do not need any other portable devices and that I would have just it and my desktop (... and work computer, and work laptop, and home server, and my wife's computer... please! anything to help me pair down the devices I use!)
  • 2 Hide
    belardo , August 21, 2012 7:28 PM
    Theres about 20 MS stores in the whole USA.

    An NO, the Windows tablet x86 will NOT sell for $200~300. That is the WART version. The X86 version will sell for $700~1200 (depending on config).

    If MS sells the WART 10" for $200, it would be at a $45 loss, but that is fine as they NEED to grow their market share ASAP to get people to try it out and developers to make apps for it. If the user buys 10 APPs a year + x number of songs, it will pay for itself quickly.

    At $300, MS would make a $50 profit, which would be preferred - but could cost them sales. They need a fire sale since they are dead last in the market.

    The only tablets that most people seem to be intrested in, is the x86 version which has all the problems of current x86 tablets. Heavy, thicker, far less battery life (4~5 hours), noisier, hotter... and of course, cost too damn much. THAT will not sell enough to be a knock out... and the WART version at $300 or $400 is way too weak against the iPad and Android devices already on the market.

    At a $200 loss, they can sell them a lot easier over an Android.
  • 0 Hide
    trevorluce , August 21, 2012 7:59 PM
    Wow I was not even aware Microsoft had brick and mortar stores...
  • 0 Hide
    Shin-san , August 21, 2012 9:54 PM
    That's quite a bold number. Let's hope that the guys responsible for marketing the Xbox are on this and not the guys responsible for marketing devices like the Zune
  • 0 Hide
    drakennz , August 21, 2012 10:52 PM
    do writers even review their spelling/grammar before posting anymore?
  • 0 Hide
    belardo , August 21, 2012 11:19 PM
    Yep Trevorluce, there are 21 exciting wet-your panties Microsoft stores in the USA! They are so original, it takes a lot of thought to not confuse them with Apple stores... The only difference, they have 4 different colored shorts. The red ones will die first, of course.

    They may have 30 stores open by R8PE day. LOL

    None in Dallas (But there are 5 Apple stores within 20 minutes from where I live here)
  • 0 Hide
    g00fysmiley , August 22, 2012 1:48 PM
    sell it for $200 and me and my wife will have new tablets the day they go on preorder... $250-$300 and we'll be getting one to try and if we like it ordering a second... hope m$ does this right