Microsoft Corporation has done a lot of things right, but their new Surface device may have been badly handled from the start. Just taking things from a business standpoint, there really is something horribly wrong going on behind the scenes. The still relatively new tablet device took in $893 million in revenue last quarter for the Microsoft Corporation. That number sounds great, but the company spent $932 million advertising, building, and shipping out the handheld device to consumers. That adds up to a loss of $39 million. So, despite being Best Buy’s top-selling Black Friday item, the touch-screen device ended up as a revenue sinkhole.
The Surface RT itself has failed to attract enough users thus far, and as a result has failed to penetrate into the iPad-dominated market share. For all the bells and whistles, such as a keyboard, Microsoft’s initial handheld device offering fails to deliver in simple usability.
The real keyboard that works with the Windows-based tablet tends to be the first sore point among new users. After purchasing a new device, users quickly discover that it does not come with a keyboard at all. They are forced to use the touch screen keyboard equivalent. This is strange, considering that commercials highlight the real keyboard as a major advantage over other tablets. Users later discover that the keyboard costs an additional $100 and up at the official online store. The simple keyboard and dust cover is literally being sold for almost half the price of the tablet device itself. This is a shameful ploy. Microsoft Corporation could not have handled the keyboard situation any worse, and the operating system for the Surface was also badly designed.
The device comes with an operating system called Windows RT. “RT” stands for runtime, but running programs is exactly the opposite of what the system actually does. It is a unique build of Windows 8. The surface comes with a USB port, and it is easy to connect flash hard drives and transfer files. End users will quickly discover that the handheld device is incompatible with just about every program out there. The touch pad dynamo was only designed to run programs from its own app store. Users cannot even make use of on-the-go portable WiFi devices from companies like Clear, because the devices must install software to access wireless network signals. It will not even allow a user to modify Gmail in order to make use of Google Talk, a commonly used feature.
The most routine complaint about the handheld wonder is that users cannot install third-party internet browsers like Chrome or Firefox. End users rarely trust Internet Explorer, and this makes the touch pad driven device even less appealing.
This week on Wall Street, money has been coming out of high performance stocks like Netflix and Facebook and back into old trusted names. Microsoft Corporation should be one of those names, but they handled this Surface device very badly since the get go. With the company trading near record highs, a money-losing device like this could edge away at the share price over time. Investors do not want to see their company producing mediocre copies of better products.
Opinion by Luke Sargent