Analyst still believes Microsoft will kill the Surface line next year

[midian182]

A hot potato: Late last year, the CEO of analyst company Canalys, Steve Brazier, made a bold claim: he said Microsoft would kill or spin off its Surface line in 2019. Over 12 months later and despite an increase in YoY sales, Brazier stands by his prediction.

In October 2017, Brazier said Microsoft boss Satya Nadella is “a software guy, a cloud guy,” and that Surface hardware would go the same way as the Microsoft band and the company’s smartphones. He called the line “a low margin business,” adding that it didn’t make sense for Microsoft to keep on making the products.

Since those statements, we’ve seen the release of the $399 Surface Go, which has gained many positive reviews. There were also a number of new Surface devices, including the Surface Pro 6, Surface Laptop 2, and Surface Studio 2, unveiled at Microsoft's Surface event earlier this month. It even launched a brand-new category in this line: Surface Headphones.

Surprisingly, Brazier still stands by what he said last year. Speaking about Microsoft continuing to produce Surface hardware, he said, "I stand by the fact that it doesn't make sense," reports The Register.

"It would be much more sensible for Microsoft to stop spending money on Surface and focus on its cloud and application business where it's doing really well," Brazier added. "I think [Satya Nadella] will get to that conclusion. It may need them to have a choppy quarter or two before he pulls the plug."

Despite other industry execs, including Lenovo COO Gianfranco Lanci and Dell chief commercial officer Marius Haas, agreeing with Brazier to varying extents last year, it always seemed extremely unlikely that Microsoft would end or even scale back its Surface products.

In addition to releasing new Surface hardware in 2018, Microsoft’s fiscal quarterly and yearly financial results showed revenue from the Surface line jumping 25 percent, while sales were up 16 percent YoY. Additionally, a report from research firm Gartner last week showed that for the first time, Microsoft had become a top 5 PC vendor in the US, thanks to its Surface machines. All of which suggests that Brazier’s confidence in his previous remarks may be a mistake.

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https://www.techspot.com/news/76920-analyst-believes-microsoft-kill-surface-line-next-year.html

 

[cliffordcooley]

It has taken this long for Surface to become seasoned. Microsoft would be crazy to drop them now. But then judging by their past, I wouldn't expect anything else. If it wasn't for their prices I, might have bought one. However their history of dropping support really is discouraging.

 

[yRaz]

This guy is an idoit. The surface line was never really meant to make a profit, it's advertising. It's to show the potential of windows 10 against Apple products. They are beautiful devices and good enough to get a consumer interested in the ecosystem. If they turn a profit, great, if not they still do a great job at theor primary goal. And that is to be display models to show off windows 10 to customers who walk into stores

 

[Radprincess]

Some folks do not want their information on a cloud based data saver. I would much rather save it on my own device.

 

[gcarter]

Whilst the Surface line have obtained some good rep, I personally think they look like glorified tablet, with a butt ugly stand at the back.

Good riddance I say, if these rumours turn out to be true.
If I want a tablet, will buy a a tablet, if I want a premium laptop will go and buy a MacBook (oh wait ;-) )

 

[Sausagemeat]

Very few people will miss them.

 

[poohbear]

MS becoming top 5 PC vendors in such a short time is pretty damn impressive. Why the hell would they spend so much time building up a product and then dropping it when its starting to become successful??

 

[Raytrace3D]

I use my Surface Pro 3 quite a bit still. It was well worth the purchase for my needs. I don't see M$ quitting this early on Surface as they are actively supporting new models and making nice improvements, including the price. Granted, it's a premium, but there are those of us who do find value in it. Since I purchased my Surface 3 I have yet to use my laptop when I travel - it does everything I need it to. That said, I do use a desktop PC (Threadripper baby!) as my daily driver.

 

[yRaz]

I use my Surface Pro 3 quite a bit still. It was well worth the purchase for my needs. I don't see M$ quitting this early on Surface as they are actively supporting new models and making nice improvements, including the price. Granted, it's a premium, but there are those of us who do find value in it. Since I purchased my Surface 3 I have yet to use my laptop when I travel - it does everything I need it to. That said, I do use a desktop PC (Threadripper baby!) as my daily driver.

People don't seem to understand that the surface brand is a way for Microsoft to break even on advertising and marketing Windows 10, which it excels at fabulously. It was never meant to be profitable, it was meant to reduce the cost of marketing

 

[psycros]

"In addition to releasing new Surface hardware in 2018, Microsoft’s fiscal quarterly and yearly financial results showed revenue from the Surface line jumping 25 percent, while sales were up 16 percent YoY."

Not much to brag about when the market is so anemic right now. 16% gains on next to nothing is kind of irrelevant. Like others have stated, Surface is a gimmick, a way for Windows 10 customers to get a bit of that Apple-esque vibe (I.e. feeling special for spending too much on hardware).

 

[Todd C]

Lol I want some of what Brazier is smoking on. He's got that **** that makes you go dumb.

 

[Evernessince]

It has taken this long for Surface to become seasoned. Microsoft would be crazy to drop them now. But then judging by their past, I wouldn't expect anything else. If it wasn't for their prices I, might have bought one. However their history of dropping support really is discouraging.

You can get refurbished models for pretty cheap actually. Around $500 gets you a surface pro 3 i5 8GB with type cover and pen. Pretty good considering the hardware and form factor.

 

[toooooot]

It has taken this long for Surface to become seasoned. Microsoft would be crazy to drop them now. But then judging by their past, I wouldn't expect anything else. If it wasn't for their prices I, might have bought one. However their history of dropping support really is discouraging.

You can get refurbished models for pretty cheap actually. Around $500 gets you a surface pro 3 i5 8GB with type cover and pen. Pretty good considering the hardware and form factor.

If I knew that I d get it instead of lenovo laptop for near 800...

 

[Evernessince]

If I knew that I d get it instead of lenovo laptop for near 800...

I was surprised at the price as well. Great gift for college students.

 

[Nitrophos]

They won't end it. He might be a software guy but this is more than about promoting the (horrid imo) windows 10 platform and more about microsofts public image and ability to take market share from apple when it comes to high end mobile computers

 

[Xclusiveitalian]

I got the Surface Pro 3 I3 for $430 and LOVE it as much tablet/mobile PC. It's not my daily driver but that wasn't what I wanted it for. It's great and I do love the Surface line. I also will never touch another Apple product again.

 

[RossT76]

Even the experts get it wrong. Just ask Ken...
"There is no reason anyone in the right state of mind will want a computer in their home" Ken Olsen, President of Digital Equipment Corp, 1977

 

[Mister_K]

Including the Surface Book or just the "lesser" Surfaces?

 

[Tom Mariner]

"... other industry execs, including Lenovo COO Gianfranco Lanci and Dell chief commercial officer Marius Haas, agreeing with Brazier" The reason we have the compact Surface line is that Microsoft tried and failed to get Lenovo and Dell to build computers for their operating systems and other software, so they did it themselves. After a billion-dollar disaster with the first models, a lesser firm would have abandoned ship.

But, just like Elon Musk and his "short sellers", there are always "analysts" grabbing headlines with tales of doom. If the gloom-spreaders had talent they would BE Musk or Microsoft.

 

[Teko03]

Surface going away would be ridiculous. I currently have a Surface Pro 4 (Surface RT before that), and honestly the Surface Pro devices are the only mobile PC's I'll ever purchase ever again. It's the perfect laptop and tablet combo personally.

 

[Bill A]

That guy with his prediction must be smoking crack.

Surface design is leading by example for Windows 10 and other operating systems.

Apple, Google and other companies designed their hardware based on the Surface line.

 

[keithwwalker]

This guy is smart (not), just like those Ford execs who are choosing to stop making cars because there is less profit margin. Always surprised that M$ manages to keep a hold on the business software market - I think the Surface actually helps in that regard. Cloud computing is the future, don't know why they can't do both. You can bet that Google will leverage hardware if they could get their feet in the door of more cloud computing.

 

[onestepforward]

Apple, Google and other companies designed their hardware based on the Surface line.

And you reckon the guy with the prediction is smoking crack? It is clear that you've never used Apple products.

I use a Surface Pro daily for work, along with a MBP and iMac for personal use. Every aspect of the SP is simply awful to use - Win 10, the Arc mouse and Typecover keyboard. Together, these are a form of torture the likes of which should be made illegal by the UN. MS tried. MS failed. No-one is stupid enough to copy their design. Get over it.

 

[tipstir]

Tablet idea really popular back in late 2010 and today a lot of people prefer laptop. I know that the surface can turn into tablet with a keyboard. But still you need the surface box to connect LAN if you don't do WiFi. That box is huge too. Just like with the Windows 10 cell phone downside and not you say the Surface as well The only turn around for all this would be if the tech for transparency acrylic polymer carbon fiber reinforced plastic. Just maybe tech would would turn around. But until then what's available just not selling like it use to be. Apple iPAD was expensive but they have such a huge tablet you might as well just buy laptop.

 

[DelJo63]

Hmm; It all depends upon where you get your information.
www.telegraph.co.uk says:

Microsoft’s Surface business is making more than $4bn (£3bn) per year, marking a revival for the company’s tablet and laptop division.

Panos Panay, Microsoft’s chief product officer, said the company had recorded more than $1bn every three months in its Surface business ahead of the release of a new tablet, the Surface Go, this week.

Microsoft has spent the last 12 months revamping its Surface range, which had seen revenues slip and struggled to break the back of a sluggish tablet market.​