Oh dear. We’ve held the position that Microsoft is making a big gamble with its barge into the tablet market (and its history with consumer hardware is, apart from the Xbox bright spot and a mouse or two, pretty dire).
Now it seems that gamble is coming up short. If new figures from Canalys are correct, the Surface RT – not yet released in New Zealand and no sign of when or if it will be either - is tanking.
Market watcher Canalys calls everything a PC – well, tablets are included along with laptops and PCs.
As a result, it says worldwide PC shipments increased 12% year-on-year in Q4 2012 (where IDC says PC sales declined in Q4 by 6.4%) to reach 134.0 million units. The juicy bit is that pads accounted for over a third of those millions.
So who schnaffled up the sales? Predictably, Apple took the lead, shipping 27 million gadgets (pads, Macs, Macbooks all included, by Canalys’ measure).
HP shipped 15.0 million, Lenovo a shade less, Samsung’s strong tab sales put it in the top five with 11.7 million PCs.
But where in all of this is Microsoft’s much-vaunted Surface RT? No need to talk millions. Canalys provides an unvarnished insight, revealing that only 3% of pads shipped in Q4 2012 used a Microsoft operating system.
It describes Redmond’s entry into the PC hardware market as ‘something of a non-event’, hampered by ‘high pricing, poor channel strategy and a lack of clarity regarding its RT operating system’.
The net result? Just 720,000 Windows RT units were sold.
“The outlook for Windows RT appears bleak. Hardware OEMs are ignoring it due, in part, to a pricing strategy that does not align with the economics of the pad market,” says Tim Coulling, Canalys Senior Analyst.
“We expect Microsoft to rethink its pricing strategy for RT in the coming weeks. Dropping the price by 60% should get OEMs back onside.”
With hundreds of thousands of Surface RT devices likely clogging up inventory – and with the lifespan of the ‘latest and greatest’ tablet being somewhere between 6 months and a year, there may well be room for that price cut.
Of course, the Surface Pro, loaded with an Intel Core i5 processor, is just around the corner.
Once again, questions will be asked of Microsoft’s understanding of the economics of the pad market: this more expensive device will also have a reduced battery life.
Chances are things are about to get even tougher for this particular roll of Microsoft’s dice.