Resellers hint at weak U.K. sales of Microsoft's Surface

Almost a year since Microsoft's Surface RT went on sale, the company remains frustratingly tight-lipped when it comes to breaking down sales figures of the tablet and its pricier Windows 8 Pro sibling. The $900m write-down on Surface inventory was a pretty damning indicator of sales performance, of course, and the latest drips of information from the U.K. sales channel also hint at weak sales in recent months.

The Channel - an offshoot of The Register - has tapped its sources "close to Microsoft" who shared details relating specifically to sales of the tablets through Microsoft's reseller partners in the United Kingdom. While Surface devices have been on sale at John Lewis department stores and a range of PC World stores across the country (as well as on PC World's website), Microsoft opened up its distribution channel in August to allow some of its reseller partners - including the likes of Misco, Kelway and Insight - to sell the tablets to a broader range of customers. 

According to the sources, Microsoft allocated a total of just 2,000 Surfaces - around 1,500 RTs and 500 of the Pro model - to wholesalers Tech Data and Ingram Micro, who were tasked with distributing the devices to the first nine resellers. Since then, all 2,000 Surfaces have sold out, with some resellers reporting that they had actually received more orders than their supply could satisfy. However, the sources also said that "demand has not been overwhelming", suggesting that the total number of orders they received is unlikely to be much higher than that 2,000-unit figure. 

It is important to underline the fact that these insights relate specifically to sales through the reseller network, and only since August, and do not take into account sales made through John Lewis and PC World, or Microsoft's website, in the U.K. since the RT launched there at the end of 2012, with the Pro going on sale in May

But even if we charitably assume that a few thousand Surfaces were ordered through resellers during the last three months against the 2,000 units in stock, that still indicates weak overall interest in the tablets, especially given that the decision to open up sales to resellers was obviously intended to increase visibility and availability of the devices in an effort to stimulate sales. 

Perhaps hinting at similarly weak demand in store-based sales, another of The Channel's sources claimed that Microsoft will focus less on chasing consumer sales in the U.K. for its next-generation Surface 2 and Surface Pro 2 tablets, instead targeting business and education customers. 

Source: The Channel | image via Microsoft

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Microsoft need to realize, its just not gonna catch on. Just like Windows Phone.

Its been 7 years since the iPhone.
Its been 4 years since the iPad

Seriously, mobile is a lost for Microsoft.

Probably hasn't helped that each of the Surface models in my local John Lewis (Liverpool One) were constantly stuck on the password protected lock screen. I saw numerous people have a go and then walk away frustrated because they couldn't get into it. Admittedly the store password is easy to guess, but it's funny that the iPads aren't locked down in the same manner.....

I am a big fan of surface products. I own surface pro. However the hard reality is surface is not in the shopping list for almost everyone. Microsoft has ask itself - Do we want to sell surface to the masses or to a niche crowd?

Right now the answer is they are selling to a niche crowd. They can sell to the masses by putting the product in the following price range:
1. 64GB surface 2.0 at 299. 128GB - 399
2. 128GB surface pro 2.0 at 699. 256 - 899.

I think they know this. But we all know how microsoft works. They start the race like a turtle and finish like a rabbit. They will get this right in surface 3.0. They will product 8 in one for 199. 10in one for starting at 299. and Surface pro 3.0 will be 699 for 128GB.

£299 for Surface 2 RT and touch over and stylus to help with the few desktop apps. I would buy one if it was sold at a sensible price.

duh, of course it's not selling well. There's not that many people who want/need a desktop OS in a tablet form factor. If you want a desktop experience on a tablet, buy a surface, want an ultrabook, buy an ultrabook, want a tablet, buy an ipad/android tablet. Simples!

So let me get this right, not only is this about resellers, and not the direct retail channel, but it's also abut the first gen devices that are, if MS has done this right, probably running low anyways as they've shifted production to the new 2/Pro 2 models and stopped making the originals long ago. Add to this that these resellers only recently got the chance to sell Surface RT and Pro models to begin with?

This is mostly a non-story here, now if we could get direct numbers from the big retail channels as a few have already mentioned above, then we'd be talking. I bet MS is on it's last batch of Surface RTs which they are still openly selling directly themselves and that they have very few Surface Pros to sell either directly or to resellers so that these small numbers given to them should be no surprise. MS officially stated that when the new Surface Pro2 goes on sale they're not going to sell any more of the original Pros, they're done with them and probably have a few thousand left that they'll trickle out to resellers in all the markets that they sell to, which means many will only get a handful while others get a few hundred at best.

not sure about the UK but i have still never seen a surface tablet and i have been trying to go places to see and perhaps even buy one. We have even tried to get demo units from our vendors here at work as we might want to buy a few here as well but we are not able to get our hands on one. Being as how expensive they are i cannot see us just buying one and hoping it will work for what we want.

For me, Surface is too thick and expensive to consider. IMHO, Microsoft got the worst from both worlds: high price and bulkiness.

Mortis said,
For me, Surface is too thick and expensive to consider. IMHO, Microsoft got the worst from both worlds: high price and bulkiness.

Surface is thinner than an iPad, and only slightly heavier...

The title should have mentioned that it's referring to Surface RT and not Surface 2.0

Who would buy a Surface RT at this stage when Surface 2 is around the corner and can already be pre-ordered ?

Microsoft is underestimating the effects of the bad press that generation 1 devices got and how this perception made its way into the consumer's mind. And unfortunately, the press continues to be negative about the newest generation.

And if you add the negative mood that built-up with Windows 8 to this equation, you have a pretty bad marketing problem in hands.

At least one thing is positive about this news, MS now knows it's real demand of overpriced junk and giving what it can sell to unsuspecting customers and fanboys. By the way of 2000 units, how many people returned it next day.

Auditor said,
At least one thing is positive about this news, MS now knows it's real demand of overpriced junk and giving what it can sell to unsuspecting customers and fanboys. By the way of 2000 units, how many people returned it next day.

You lost ALL credibility at "overpriced junk". Stopped reading. Get lost, troll.

Jarrichvdv said,

You lost ALL credibility at "overpriced junk". Stopped reading. Get lost, troll.

You sound like one mad fanboy. I don't care about certificate of credibility from MS fanboy. Go and buy a Surface tablet and support MS. MS needs all the help from people like you to justify their flop product.

Commentary from The Register... yawn.... As a first gen device goes, SRT1 was/is pretty damn good. I bet the satisfaction level of us few buyers is a lot higher than those who <s>clamored</s> for a Motorola Xoom.

Many reasons for it to not set the world on fire - price being the most obvious fault of the vendor. And then not holding a gun to Facebook's head (what was that $240 million for?!).

I don't think many people would buy via resellers anyway when they can buy direct at the same cost. 1st gen devices for any company typically have low numbers anyway. The Surface 2 will do much better since people usually wait until 2nd or 3rd gen devices.

I for one, can't wait to get my Surface 2... sold my awesome RT and have Surface 2 pre-ordered. :-)

Well I'm into buying the Surface Pro 2 265GB, but the waiting queue in The Netherlands is December 15th, if you consider the waiting queue in the US of 29th of October it must be either selling like crazy in NL or selling badly in the US :-S
Still one advantage, like this I can still wait and cancel depending on what Nokia has to show :-P

Spicoli said,
Why would you buy through a reseller when you can buy direct?

Because John Lewis offer a 2 year guarantee which MS should offer in line with the law but dont!

I hope they will start selling the Surface Pro 512GB soon, its got my name written all over it!

Robin Jones said,

Because John Lewis offer a 2 year guarantee which MS should offer in line with the law but dont!

Fine, but it was already on sale at John Lewis. This article doesn't count numbers sold by them or PC World, or Microsoft directly.

Robin Jones said,

Because John Lewis offer a 2 year guarantee which MS should offer in line with the law but don't

*sigh* that's the EU law not the British one. We felt the Sale of Goods act was better and never adopted the law.

Robin Jones said,

Because John Lewis offer a 2 year guarantee which MS should offer in line with the law but dont!

I hope they will start selling the Surface Pro 512GB soon, its got my name written all over it!

Talking of John Lewis, i was in there a couple of weeks back and they had an original Surface RT in the 'discounted' section. Anyway a couple picked it up, sort of like "oh look here`s a tablet" then rambled on about what`s a Surface but saying it`s got windows on beacause they see the Microsoft name.
Then i think they got an ipad! The same surface RT is still sat there, kinda lonely

TruckWEB said,
It's all about the Apps...

A real good Internet browser can replace a couple of missing apps, but that's it.

Yep, lack of apps absolutely kills Surface RT/2

Yeah, it does more than an iPad etc. but when you hit a road block of no app or some site doesn't work it is absolutely infuriating.

Take Sky Go, very popular but no app like iOS.

No worries, view through the website.

Silverlight required. Windows RT doesn't support Microsoft Silverlight.

Rage!!!!!!!

Printer support is a bit off as well.

If the app store catches up to iOS and Play then great but I could never recommend a Surface RT/2 to anyone otherwise.

Everyone knows it was a slow start for the first gen devices. We will see if that can turn around with the 2nd gen stuff.

An allocation of just 1,500 Surface RTs and 500 Surface Pros? Even if that's only meant to last a couple of months, and assuming that most sales are made through Microsoft's website, those numbers are incredibly low.

theyarecomingforyou said,
An allocation of just 1,500 Surface RTs and 500 Surface Pros? Even if that's only meant to last a couple of months, and assuming that most sales are made through Microsoft's website, those numbers are incredibly low.

Small allocation and weak demand no doubt due to the imminent release of Surface 2. Anyone who really wants a Surface 1 already got one. And the numbers don't include many major PC retailers.

rfirth said,
Small allocation and weak demand no doubt due to the imminent release of Surface 2. Anyone who really wants a Surface 1 already got one. And the numbers don't include many major PC retailers.

That's unlikely given that the Surface 2 was only announced two weeks ago and the stock allocation occurred considerably before that. We already know that sales have significantly underperformed the expectations of both Microsoft and the market, which these figures support.

theyarecomingforyou said,

That's unlikely given that the Surface 2 was only announced two weeks ago and the stock allocation occurred considerably before that. We already know that sales have significantly underperformed the expectations of both Microsoft and the market, which these figures support.

Even if Surface 2 and Pro 2 was announced two weeks ago and this article talks about allocation that happened back in August, which is just 2 months, it's talking about resellers, a small group in and of itself, and not the bigger retailers. Also MS has stopped making RT and Pro models long ago I'm sure and have prepared and shifted production to the new Surface 2 and Pro 2 models. I highly doubt they're still making any of the gen1 devices and haven't made any in months. Case in point, MS has officially stated that they're no longer going to offer the Surface Pro when the Pro 2 goes on sale, the RT is still on sale because we all know they made too many of those to start, but halting the sale of Pro models indicates to me that they're already close to selling through all of the ones they've made.

I'm not trying to say sales are way better than everyone thinks or anything like that, only that this story is nothing, resellers back in August got a small allotment of older models that are no longer being made for one market (the UK). This really isn't news, I'm sure resellers in other markets got small numbers of devices as well and I bet MS only has a small number of Pros left to hand out to begin with.

Exactly, few people will be buying a Surface knowing that Haswell based 2nd generation devices built for Windows 8.1 were coming out mid-October. This article is fud.

I'm guessing the huge price did not help and will not help in the future.
I really want a Surface Pro 2, but I just can't justify £719 (c$1146) for the cheapest one.

F_C said,
I'm guessing the huge price did not help and will not help in the future.
I really want a Surface Pro 2, but I just can't justify £719 (c$1146) for the cheapest one.

just get one of the cheqper and similarly spec tablet made by an oem then, one with a haswell cpu, 4GB ram, 5 point multi touch screen with digitiser pen and full HD display. Oh wait, you cant! They don't exist! Surface pro gives you a lot of bang for your buck.

How is £719 expensive? It's an ultrabook, tablet, digitiser all-in-one.

If you want a cheap tablet to play games and run apps then get a Kindle or Nexus for £200ish. If you want something powerful that can play the latest games, run photoshop, work in Office and more intensive programs then the Surface Pro is an amazing device at a decent price.

People have been spoilt by Google and Kindle subsidising their tablets as Trojan horses for their app stores and have unrealistic expectations of pricing for proper laptops. A MacBook Air should be £150 by now, it has no apps, no touchscreen and you can't remove the keyboard to use it as a tablet (not bashing Apple, just an example of people's stupidity that they find the Surface Pro expensive).

The Surface will just be a weak seller. It's a nice device, but I'd rather buy an ultra book over the Surface Pro and an iPad or Google tablet over the RT. Unless Microsoft does something amazing, the Surface will never be a "hot" item.

JHBrown said,
The Surface will just be a weak seller. It's a nice device, but I'd rather buy an ultra book over the Surface Pro and an iPad or Google tablet over the RT.

Those who want an ultrabook, buy an ultrabook, and those who want a windows x86 tablet, buy a surface pro or some other brand.
Why some people insist on comparing tablets to ultrabooks?!

JHBrown said,
Unless Microsoft does something amazing, the Surface will never be a "hot" item.

What else you'd want a surface to do? Wash your cloths and prepare your dinner??!

Surface RT/2 already can do a lot more than ipad and android tablets, not to mention they come with a desktop-grade browser.

If it's the apps, then MS can't do anything.

JHBrown said,
The Surface will just be a weak seller. It's a nice device, but I'd rather buy an ultra book over the Surface Pro and an iPad or Google tablet over the RT. Unless Microsoft does something amazing, the Surface will never be a "hot" item.

Depends. Why would you rather have a Google Tablet over a Surface running Windows RT? Ipad I can understand, some people just want anything Apple. However saying you'd take a Google tablet over a Surface RT seems to suggest there is something wrong with Surface itself.

The way I see it all it lacks are apps. And there actually are a lot of apps so that problem is greatly exaggerated. Besides that Surface is a perfect tablet for students and other people who also need to do some light-productivity work. Besides that Surface has great build quality.

So what is preventing Surface from becoming a 'hot' item in your mind? Seems to me it has what it takes but they just need to build up a reputation and perhaps wait a while for the store to build up further. As of now people simply don't know about Surface. And Surface is a more expensive tablet. So its not as if Microsoft is competing on price with the cheap Android tablets.

They really need people to want a Surface to meet their needs. I'm sure Surface meets the needs of many people but those people still need to know about Surface. Luckily the student deals of Surface RT are doing that right now.

ians18 said,
Why would you buy an ultra book over the pro? Screen size? How about an iPad/Google Tablet over RT?
I would go for an Ultrabook over a Surface Pro because I hate typing to either cover, the trackpad is tiny and it's a bad experience using it like a laptop on your lap.

I'd go for another tablet simply because my ideal tablet size is smaller than the Surface (Google Nexus 7 / iPad Mini size).

coderchi said,
and you will always be a troll!
Where is the trolling genius? It's my personal opinion about the topic. So you call someone a troll, when in fact you're doing the same thing. Got it!

virtorio said,
I would go for an Ultrabook over a Surface Pro because I hate typing to either cover, the trackpad is tiny and it's a bad experience using it like a laptop on your lap.

I'd go for another tablet simply because my ideal tablet size is smaller than the Surface (Google Nexus 7 / iPad Mini size).

This is my reason for the Ultrabook over the Pro. But I guess I'm trolling according to coderchi because I prefer something different.

If Apple were to release the iPad for the first time in a market in August, with the rumored October release date of the next version and only sell 2000 then people would claim those sales are expected because of the soon to be released new version. It already happened when iPad sales dropped 14%. But with a Microsoft product, it is because nobody wants them.