Microsoft being too modest with Surface Sales estimations?

[tsupersonic]

The fact that you can't buy Microsoft Surface in store right now must have an impact. They don't have Microsoft Store everywhere and for things like that, I tend to prefer to play with the device before buying. Surely I'm not alone that prefer to try before buying so the fact that you can buy Surface online does little for me.

But every BestBuy, FutureShop have all the iPad or Android tablet you'd like. So, MS will have a hard time....

As of right now, no store close to where I live have a WinRT/WinPro tablet.

You're not the only one - I prefer to play with devices before I buy them, which is one reason to highly value B&M places. You can't try a monitor/mouse/keyboard online, you can only read reviews/watch videos. But, it's nice B&M places still exist so I can try the product, even if I don't buy it there :p For something like this, yeah, I too would need to play with the Surface before I could buy it. Also, there are no Microsoft stores anywhere near me, the closest place is actually in Canada (and I'm in western NY - sad that my closest location is in another country). Tsk tsk Microsoft, if you want to see your products succeed (aka market share), advertise wisely, and expand your locations.

[HawkMan]

MS can't compete with its OEM partners without cannibalization occurring, but I'm not going to keep explaining this simple concept. Competing against MS isn't the same as competing against other OEMs in this space, for obvious reasons.

The tablet market existed before the Surface. Last I remember the Kindle Fire, iPad, Google Nexus 7, and a litany of Android tablets dotted the landscape prior to the arrival of the Surface...

The non Windows based tablet market is kind of irrelevant and doesn't factor into cannibalization anyway. And yes they can, again it's called competition, if the surface didn't have to pay for the windows license, then you might have a point.

otherwise, as I said, all the OEM would be cannibals as well, which they are, but it's called competition. Cannibalization is what MS did when they released the Zune and became the second most popular PMP, while Apple didn't lose any sales and all their plays for sure partners lost out. That's not what's happening here. In fact, the surface in many ways is beneficial for the OEMs. as their devices are cheaper, whenever they decide to release some. So they benefit from MS ads and market penetration, and then they see a cheaper device that is the same thing and they go for that. They're basically paving the road for them. Something all the OEMs are capable of seeing except one, which is also not known for it's reputation of high quality hardware.

[+LogicalApex MVC]

The non Windows based tablet market is kind of irrelevant and doesn't factor into cannibalization anyway. And yes they can, again it's called competition, if the surface didn't have to pay for the windows license, then you might have a point.

otherwise, as I said, all the OEM would be cannibals as well, which they are, but it's called competition. Cannibalization is what MS did when they released the Zune and became the second most popular PMP, while Apple didn't lose any sales and all their plays for sure partners lost out. That's not what's happening here. In fact, the surface in many ways is beneficial for the OEMs. as their devices are cheaper, whenever they decide to release some. So they benefit from MS ads and market penetration, and then they see a cheaper device that is the same thing and they go for that. They're basically paving the road for them. Something all the OEMs are capable of seeing except one, which is also not known for it's reputation of high quality hardware.

There are more types of cannibalization than just internal cannibalization. The type of cannibalization I'm referring to here is called market cannibalization since, obviously, the partners are not internal to Microsoft.

Additionally, to see Microsoft as pure competition is wrong. Competition works when all of the players are on equal footing. In the Windows RT market Dell, and other OEMs, are not on equal footing against Microsoft. At the most basic level, MS is the branding associated with the most visible part of the product, the OS, and they benefit enormously from that.

If your argument made any sense, which it doesn't, then Microsoft would ensure that the Surface was as accessible to consumers as any other OEM is going to try, but they won't do that. They are purposely keeping the Surface out of B&M and away from Amazon and it isn't because they hate the color of money.

[HawkMan]

So basically you're calling competition cannibalization.

And they are on equal footing, in fact the competition stands stronger since MS is fairly unknown in hardware, and their hardware is more expensive. and the average person isn't going to care that the kickstand on the Surface and the rest of the device is of superior quality when they'll use it handheld anyway.

Not ebing in BM might actually not be MS' choice, also trust me that getting your device into BM stores isn't that easy. not with as many unknowns as there are, and right now at this point in time it's actually more beneficial for them to not be there, especially since they avoid the bad association with the price premium.

[George P Global Moderator]

The tablet market is young and growing fast, there's no cannibalization going on at this point when you don't have a fixed/mature market to target, to that extent "marketshare" numbers just means who can sell more and keep up with the growth. You could have a low overall marketshare % but sell something like 3 million units. Does that mean your product hasn't done good? It seems to be that if you don't sell the most then you're failing in tablets and phones with the way some people look at things.

Anyways, OT, originally months ago SteveB said they planned to sell 3 million by the end of the year iirc. Flash ahead a few more months and we have reports that MS ordered 3-5million to be made. We'll know when the time comes but if they sell anywhere in the area of 3-5million then it's a success. It's not iPad numbers but it doesn't have to be, it's just one Windows tablet in a bigger group. If the others can sell 1-2million or so as well then we're talking WinRT/Win8 taking a good chunk of the tablet market for 4Q12 and or 1Q13.

[+LogicalApex MVC]

So basically you're calling competition cannibalization.

And they are on equal footing, in fact the competition stands stronger since MS is fairly unknown in hardware, and their hardware is more expensive. and the average person isn't going to care that the kickstand on the Surface and the rest of the device is of superior quality when they'll use it handheld anyway.

Not ebing in BM might actually not be MS' choice, also trust me that getting your device into BM stores isn't that easy. not with as many unknowns as there are, and right now at this point in time it's actually more beneficial for them to not be there, especially since they avoid the bad association with the price premium.

Competition can be cannibalism, but that isn't what I'm referring to. I am not sure why this tangent is going on for so long really. Microsoft is not an equal footing competitor to Dell. As I have said many, many, times in here any cannibalism won't be known until the quarterlies are released. There many be none (the market itself is growing rapidly and MS is a very small part) or there may be lots (MS Surface sales covering over 50% of Windows RT tablet sales).

It is one of many questions that will be answered about the Surface in time. I'm not making any definitive statements when no hard numbers are publicly available.

The tablet market is young and growing fast, there's no cannibalization going on at this point when you don't have a fixed/mature market to target, to that extent "marketshare" numbers just means who can sell more and keep up with the growth. You could have a low overall marketshare % but sell something like 3 million units. Does that mean your product hasn't done good? It seems to be that if you don't sell the most then you're failing in tablets and phones with the way some people look at things.

Anyways, OT, originally months ago SteveB said they planned to sell 3 million by the end of the year iirc. Flash ahead a few more months and we have reports that MS ordered 3-5million to be made. We'll know when the time comes but if they sell anywhere in the area of 3-5million then it's a success. It's not iPad numbers but it doesn't have to be, it's just one Windows tablet in a bigger group. If the others can sell 1-2million or so as well then we're talking WinRT/Win8 taking a good chunk of the tablet market for 4Q12 and or 1Q13.

It all depends on how the Windows RT market shapes up in terms of the overall tablet market. The Windows RT market can be relatively fixed while the tablet market is growing. You can also get increasing concentration around MS in the Windows RT market even though it is growing.

Again, I'm not saying anything definitive. This is why I've said so many times that we will need to see those quarterlies before we can even begin to get an idea of what is happening out there.

To argue that MS is an equal competitor to Dell as Acer is nonsense and that is all I have been attempting to make clear to HawkMan.