Microsoft’s Surface tablet was announced to significant fanfare (“significant,” at least, relative to other Microsoft consumer product launches) in June. Many pundits and early reviewers were impressed with the product’s design and software implementation of the new touch-focused Windows 8. Others weren’t so impressed. Everyone, however, was curious about one thing: the price.
Theories on price ranged from around $500 all the way to $1000. While Microsoft still has yet to announce the official price, Engadget reports that the Redmond company is getting ready to launch the ARM-based Surface tablet on October 26 for a surprisingly low price of $199.
At a sub-$200 price, the Surface would line up very well with Android-based tablets that currently hover around the $200 mark while providing, some would argue, far more functionality from a software perspective (too much about the Surface’s hardware remains unknown, but we provide a spec comparison on what’s know thus far).
Such a low price, if true, means that Microsoft will take a significant loss on each device, something that may be necessary to try and catch up to Apple and something that the company has done before to great success with its Xbox 360 console.
The alleged $199 price point may be good news for interested consumers, but Microsoft needs to consider a factor that competitors like Apple do not: hardware partnerships.
Windows 8 RT, the ARM-based version of the next generation operating system, will be primarily sold on devices from third party hardware manufacturers like Acer, Asus, Dell, Lenovo, and Samsung. While Microsoft may be willing to take significant losses on the hardware in order to push the platform, its hardware partners cannot follow suit. If a $199 Surface becomes the best option for a Windows RT tablet, Microsoft risks losing the participation of its partners not only in the RT space, but in the Windows ecosystem as a whole.
Microsoft’s pricing strategy may also impact Apple, as the Cupertino company may feel pressure to not be significantly higher in price on the rumored iPad mini than another full function tablet from such a long-time rival.
We expect Microsoft’s RT version of the Surface tablet to be out this year, as early as late October if Engadget’s source is correct, with the x86-based Surface Pro launching at a higher price in early 2013. Apple’s iPad mini launch details are unknown, with some rumors pegging it as early as September and other suggesting a 2013 launch.