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Microsoft’s Efforts to Expand Surface Market Share

Quick Pen

Quick Pen

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Microsoft (MSFT) is all charged for its upcoming press event in New York on May 20 where it is expected to unveil a smaller tablet, dubbed as the Surface Mini. In addition to the smaller version, the tech giant is expected to add another member to the Surface tablet family – Surface Pro 3 – that could make its debut in the highly awaited event. The company has sent out invitations for the event and has kept it to the minimal.

This could just be the thing for the Redmond company to stir the tablet market, and effectively compete with other existing devices – Apple (AAPL) iPad Mini, Google (GOOG) Nexus 7, and Samsung (SSNLF) Galaxy Tab.

What Does the Rumor Say?

Rumors have it that the company would introduce a miniature as well as a bigger model to expand the Surface offerings. The event would primarily focus on Microsoft’s line of Surface tablets. The tech giant has been struggling to keep going in the tablet market compared with its peers. The supposedly smaller Surface could just be the tablet to turnaround Microsoft’s tablet fortune in favor of the company and play an essential role in pulling up numbers.

Flow of events suggests that the larger tablet, Surface Pro 3, would have Windows 8.1 and sport an Intel (INTC) processor, compared with the current Surface models that are powered by Nvidia (NVDA) chips using ARM Holding technology. According to Bloomberg, the smaller version would have Qualcomm (QCOM) chips. When asked about further details, a Microsoft spokesperson abstained from giving any information as per company policy.

The company admits without hesitation that it has seen its share of difficulties in the tablet space, but is determined to develop its Surface line of tablets, make a difference and effectively compete with other devices. The tech giant is extremely keen to make a mark in this space which is dominated by Apple and Google. Since the time Surface first hit the store shelves in October 2012, the program lost nearly $300 million, squeezing profits. Even in the last quarter the Surface lost $45 million, which is 15% higher than the loss it accounted in the earlier quarter.

A Two-Step Move?

Source close to the matter say that Microsoft might opt for a dual boot tablet with both Windows as well as Android operating system. This looks like a two-step strategy. First, by offering a dual boot tablet, Microsoft will be able to reach out to those set of tablet buyers who are more comfortable using the android eco system than Windows.

The android tablet market is really strong and providing such a tablet could help Microsoft draw a big audience who would get the Android platform along with Windows. They would be able to switch between two operating systems as and when required. This would be like an added advantage to the user, who with time would get use to Windows. This will help the tech giant penetrate into the market. Second, once people get more comfortable with the Windows platform, Microsoft may opt to slowly shift to tablets dedicatedly using Windows. No doubt this would be a daring move. But I wouldn’t be surprise in case such a thing happens. Microsoft has done it in the past by selling Nokia’s android powered smartphones

Great Expectations

Expectations are already high regarding the event after Satya Nadella took charge of the company. Microsoft tablets have received tepid response in the past, but with the new CEO, investors are very hopeful. There was a time when Microsoft and Apple were at complete loggerhead, but now the Window’s maker provides a complete suite of Microsoft Office for iPad. In just few weeks, there were as many as 27 million Office downloads performed in the iPad. Such is the revolution and change that Nadella has brought to the company.

Stakeholders are therefore keeping their hopes tied to the upcoming event, expecting the tech giant to unveil the smaller tablet version to enter into the lower segment market. Currently Microsoft just holds 2% of the tablet market. It would be interesting to see how Nadella works to change the course to the company’s favor.

About the author:

Quick Pen
A seasonal writer with a Management Degree in Finance and interests in automotive, technology, telecommunication and aerospace sectors.

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