This Week in Tablets: Why and how Microsoft can succeed with Windows RT and the Surface 2

October 5, 2013
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One by one, Microsoft’s partners are pulling out of the Windows RT market. HP, Samsung, and Dell have all bailed, and it doesn’t appear that anyone has any desire anytime soon to re-engage the platform.

To unsuspecting eyes, Microsoft’s Windows RT page appears to be a sad, lonely sight indeed. Under the heading “Recommended Windows RT PCs”, there’s only one device listed: Microsoft’s Surface RT.

Even that device is about to go away, soon to be replaced by the sequel—the Surface 2. No one is sure what to make of the Surface 2 tablet, which is also powered by Windows RT, this time in its 8.1 incarnation. On the hardware side, Surface 2 is a conservative, incremental upgrade. The tablet sports a full HD 1080P display, an updated Nvidia Tegra 4 ARM-based processor, and—of course—Office 2013.

The oddity regarding Windows RT is that, fairly or unfairly, expectations for RT tablets have been shaped by existing Windows users’ desires to have a fully functioning touch-based Windows experience.

The irony is that, prior to Windows 8 in either standard or ARM-based RT variant, a full-fledged, touch-based Windows experience was the last thing anyone would have admitting to wanting in the first place. In the face of lagging ultra-book sales, you could argue that not that many people even want this now.

Based on the hundreds of millions of tablets already sold, we are beginning to understand that consumers and corporate customers want a fairly fixed ecosystem for our mobile computing needs, with broad access to creative, powerful, and inexpensive apps.

So what’s the answer going forward?

I know it sounds weird, but the very circumstances that have forced Microsoft to go it alone with the Surface as a standalone device set up a scenario that just might allow Windows RT to succeed.

Microsoft’s partner pull-out is a blessing in disguise. It grants Microsoft something the company desperately needs, and something that Apple already has: complete ownership over the fusion of hardware and software. A singular device and, more importantly, ownership over the OS and the ecosystem around that device.

Not being beholden to OEMS and partners for Windows RT means that Microsoft can do whatever it wants with the Surface 2 or 3. Say, for example, that Microsoft decided that it should place the more powerful camera on the front of the tablet instead of the back, because most people (except for awkward selfie shooters) do not take pictures with the rear camera on their tablet.

It can do that, and can even adjust the software on the RT-based Surface tablet to accommodate the higher fidelity.

Or say Microsoft wanted to do something really weird, like allow some kind of fixed rate for unlimited app downloads on the Surface 2. It could do that also, exclusively on all new Windows RT devices. Because Microsoft could, in theory, own the entire ecosystem.

If I were Microsoft, I would release the Surface 2 at an outrageous price point, like say $129. I would bundle a 7-inch version of the device with the Xbox One, and sell it as a standalone product for $99. I would be hard at work on the next iteration of the Windows RT OS, with an eye towards forking the OS away from the main Windows 8 line.

I would aggressively sell the device into school districts around the country. Loyalty here will pay off down the road.

Will Surface 2 succeed?

For the Surface 2, the value position seems like a winning one, if Microsoft recognizes this, and positions it as such. This is real. The power of the platform is no joke. Also: Most pure tablet users don’t need a Windows desktop, and never will over time. We’ve all been fine until now without one.

The best thing about the RT version of the Surface platform is that, like Xbox, Microsoft owns the entire platform. Rapid innovation can flow from this, as can forward-thinking integration into the Microsoft ecosystem—Windows, Xbox, Office, and more.

None of the above is out of the realm of the possible. In fact, it’s still possible that, ultimately, what many critics and fans view as a tragic failure could turn into one of Microsoft’s greatest strengths and tens of millions of units sold by 2015.

Possible, but not likely. Right now, I’d put the odds at around 30% in favor of this happening, and 70% against.

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