Posted on 10/05/2017 5:57:47 AM PDT by dayglored
Or so say a bunch of PC execs and Canalys CEO
Canalys Channels Forum Microsoft will quit its loss-making Surface hardware business by 2019, according to execs from PC manufacturers and a channel watcher.
Talking at the tenth Canalys Channels Forum in Venice, Canalys CEO Steve Brazier said Microsoft CEO Satya Nadella would exit the product line because he is a “software guy, a cloud guy” and pointed to the demise of the smartphone line.
He added: “The Surface performance is choppy; there are good quarters and bad quarters, overall they are not making money. It doesn’t make sense for them to be in this business.
“When the capital expenditure challenge that Satya Nadella has taken Microsoft down becomes visible to Wall Street, everyone will ask him 'Why have you gone to a low margin business?'"
Microsoft will have a lot of cost-cutting to do, Brazier claimed, and “Surface will be the first target.”
Before Microsoft launched the slablets in 2012 – starting with the RT version – the then Redmond CEO Steve Ballmer played down the project as a “design reference point” to showcase its Windows software, and estimated sales of a “few million.”
Surface endured a rocky start in its first year, caused by technical glitches and route-to-market issues, culminating in Microsoft writing down $900m worth of stock. The Pro model was better received. The specs of RT had limited adoption, though, and it was killed off in 2015.
But Microsoft’s involvement in PC hardware always appeared to be a point of tension with PC OEMs that were customers - and subsequently also rivals competing against Surface. That said, Dell and HP Inc started to flog these lapslabs direct to customers themselves. If you can’t beat ‘em….
Also commenting on the forecast demise of Surface at the Canalys event, Gianfranco Lanci, corporate president and chief operating officer at Lenovo, said he believed Microsoft may pull the plug on its PC hardware unit before 2019.
“It might be earlier,” he told Brazier on stage. “Microsoft is making a lot of money on cloud, making a lot of money on Windows and Office, but losing a lot of money on devices.
“And frankly speaking, it is difficult to see why they should keep losing money. For them it is a very difficult exercise to run hardware products business, they need to be careful about every single detail as the margin on this is so thin.”
Another attendee, Dell chief commercial officer Marius Haas, agreed that Microsoft will “probably slow it down a bit,” in reference to the Microsoft PC.
He told The Register that it was sensible to use its hardware to “demonstrate the total capability of the [software] platform” but said Microsoft had never intended to create a “broad based portfolio with a product for every form factor.”
In its last reported quarter, Surface revenue for the software giant decreased by $20m or two per cent, although it wasn't the only Device letting Redmond down. Most of the poor performance in Surface's segment, More Personal Computing, was, unsurprisingly, chalked up to poor Phone sales, which fell by $361m, year on year.
Surface sales drooped even more in Microsoft's prior third quarter, ended March 31, when revenues dropped 26 per cent.
This past quarter, More Personal Computing hauled in $8.8bn after it offset the Phone and Surface contractions with higher revenue from Windows, Search, and Gaming, which all nest under "MPC". But it all looks pretty anaemic compared to cloud sales, which were up 11 per cent year-on-year to $7.4bn in Q4, and to the Productivity and Business Processes unit, home to Office 365 and Dynamics, which saw revenues boosted 21 per cent at $8.4bn. It all underlines how sensible an idea it is for Microsoft to look to the cloud and focus less on installed software and hardware. ®
Of course, my small organization has committed to Surface for all personnel (less than 25) and I just got mine last month. I’ve actually grown to like it.
I’ve got two and a Windows 10 powered phone and love them all. I wish someone would start making windows OS phones again because mine isn’t going to live forever and I really like the OS.
Just think the NFL also committed to the Surface.
Is Bill Gates sending a message?
I have a Surface 2 Tablet and it is my favorite computer of all time. I ditched my ipad for it, so you can imagine that I hate hearing the decision that Microsoft has made. Hope my little machine will last a while longer. Have had it for about 3 years.
Committed to = paid a lot of money by Microsoft’s marketing department for exclusive and public use of.
While I don’t have one, I know several people that like them quite well. If I needed a seriously portable Windows machine again, I’d strongly consider one.
This is the #1 reason I hate Microsoft. When you buy hardware or software from Microsoft, you’ll find that they will suddenly discontinue the product and leave you hi and dry.
Remember the Zune - I bought one and actually liked it, but within a year after I bought it, it was gone.
Remember Visual FoxPro? Remember Frontpage. I spent a considerable amount of time learning and using those two but MS dropped them with no good replacement.
I will never, ever buy hardware from Microsoft because I know that MS will suddenly discontinue the product with no good replacement. I will never, ever buy software from Microsoft unless it’s a product that I know can’t be discontinued (e.g.Office).
I won’t let those bastards bite me again.
Portable computing along with touch and pen computing is not going away, so they will probably just sell the manufacturing rights to someone else.
I've used a slim/light Fujitsu Lifebook for over 6 years, and while it's been ultra-reliable and stable, all things break eventually,l and I've been thinking about a Surface as a replacement.
Now I think I'll wait-and-see if Microsoft pulls the plug. That would be a drag -- the Surface is a great product.
If that happens, I hope it doesn't go the way of IBM's ThinkPad->Lenovo.
My primary home PC is my Surface Pro 4. Fantastic device. I’m tempted to get the newest Surface Pro with LTE when it releases.
Yeah. I was kind of thinking the same thing.
Zune failed! Windows Phone failed! Surface failed! Bing failed!
What can Microsoft get right? Windows? lol
Care to oblige?
The company I work at started buying these for the managers and AVP’s. If they break they are thrown away as you cannot repair them.
iFixit concluded in an earlier review that it was not repairable.
Repairability 1 out of 10
(10 is easiest to repair)
https://www.ifixit.com/Teardown/Microsoft+Surface+Pro+5+Teardown/92362
#9 Try Microsoft Expression Web 4
Discontinued but free from Microsoft.
https://www.microsoft.com/en-us/download/details.aspx?id=36179
Once you arrange the panels the way you like, it looks like Dreamweaver CS6, I think it is better then the latest Dreamweaver 2017 which is a mess.
I still use Dreamweaver CS6. You can still get it from Adobe if you have a license.
Dreamweaver CS2017 complaints <- many
https://forums.adobe.com/thread/2230485
So my Suface 3 and Nokia 950XL are going to drop dead?
Drop dead? Nope. Run out of support sooner than you'd like? Probably.
A dead-end product line is usually only supported for a short while. There's no profit in providing support when you can't get the customer to upgrade/migrate to newer versions.
Cross your fingers that someone else picks up the product line and carries it forward.
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