Can Windows Tablets Break Out In 2014?

One lesson to date: While Apple can still command top dollar, Windows tablets only become widely desirable when they drop to Android-level pricing.



Microsoft Surface: 10 Best And Worst Changes (click image for larger view)

After mostly sitting out the Consumer Electronic Showcase earlier this month, Microsoft touted its Surface tablets last week at the National Retail Federation's Big Show in New York City. But are the devices, which were frequently out of stock during the holiday season, actually making progress? InformationWeek breaks down the good and the bad indicators, both for the Surface line and Windows tablets in general.

The good

Throughout 2013, Microsoft highlighted a number of corporate and institutional Surface deployments. It also established partner programs to build a third-party community around its Surface products. While initial Surface sales were poor, these efforts helped Microsoft to make an important point: Whether for reasons of manageability or utility, the Surface line serves at least some productivity-minded professionals better than an iPad, laptop, or even both.

Microsoft's Surface 2

Microsoft furthered this agenda at NRF, where it welcomed AnywhereCommerce and MagTek, both of which make mobile point-of-sale products, into its Designed for Surface program. In a blog post trumpeting Microsoft's Big Show appearance, the company also profiled a new Surface Pro customer, Scandinavia-based retailer MQ.

The Surface Pro allowed MQ to reimagine its store layouts, Surface senior manager Biran Eskridge told InformationWeek in a phone interview. The tablets are installed in kiosks that connect customers to the retailer's warehouses, meaning that if the desired garment isn't in stock, a shopper can summon it to the store by the next day. As a result, MQ keeps less inventory on hand, which Eskridge said has led to less-cluttered stores, greater attention from passersby, and higher revenue.

[Which tablets ruled last year? Read 10 Best Tablets Of 2013. ]

The MQ deployment joins a collection of Surface success stories Microsoft has highlighted in recent months, ranging from Delta using 11000 Surface 2s as "electronic flight bags," to real estate management firm Pedcor choosing the Surface for its entire IT division, to physicians using the tablets to provide more personalized care.

Eskridge said Microsoft probably won't share any Surface sales figures before it reports quarterly earnings on Jan. 23. But he pointed to some public data that shines a favorable light on holiday Surface sales.

Ad network Chitika calculated Microsoft's Surface and Surface 2 snared 2.3% of all post-holiday U.S tablet usage in the United States and Canada. That figure was up from 1.8% before Christmas. It also beat the share of well-regarded rivals, such as Google's Nexus tablet.

Retail analytics firm InfoScout found Surface was a popular Black Friday item, particularly the original model, which was on sale for only $199. It was the top-selling item of any sort that day at Best Buy.

Various online reports have also indicated that certain configurations of the newer Surface 2 and Surface Pro 2 (both which were better received than the first models) were out of stock at many locations throughout the holidays. Eskridge said Microsoft has found that some shoppers who were tempted into stores by the steeply discounted Surface ended up leaving with more expensive models.

Microsoft's customer satisfaction data shows that Surface owners use the device more than they used their previous tablets, Eskridge said, adding, "It validates our point of view."

Outside of the Surface, at least a few new Windows devices, such as Dell's Venue 8 Pro, generated limited buzz during the holiday season.

The bad

Microsoft has clearly made progress, but put in context we're talking about baby steps, not major strides.

Forrester analyst David Johnson told Informationweek that demand for Windows 8 is "pretty flat" in the enterprise. He noted that employee demand for Windows tablets has risen but said businesses still show a "strong preference" for iPads.

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