Surface and the Future of Microsoft

parislemon:

Charlie Kindel:

Surface is a North star product for the Windows business. It is not a “Microsoft business” (Microsoft businesses generate $5B+ a year in PROFIT). The Windows business makes $11.4B in PROFIT every year. This profit margin is under pressure from the price of a Windows license being forced down. Surface makes this worse and provides no path to recouping that profit via other means.

Microsoft may find itself stuck in step 2 of the old:

Step 1: Create product

Step 2: ???

Step 3: Profit

It’s very early to be making success predictions for the Surface. However, the niche that Microsoft should be targeting is the rather large segment of corps who want to use the iPad, but are still saddled with their legacy Windows apps. At this point, relatively few companies have shifted their primary apps to an iPad friendly interface. There’s still some time for them to over-deliver to those customers (with whom they already have MSDN relationships).

It wouldn’t surprise me if Surface tries too hard to be a consumer product following along the Xbox lines and falters on delivering to the enterprise, leaving the iPad to be the sought-after devices with Android tablets being labeled as the value brand.

(via parislemon)

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