Microsoft to Make Permanent Surface Price Cuts, Possibly Due to Overwhelming iOS and Android Competition
In the middle of July, Microsoft put the Surface RT on sale for $150 off its full retail price of $499 for the 32GB model down to $349, as well as lowering the 64GB model from $500 to $449. Two weeks later, the company slashed the price of its Surface Pro tablet by $100. These sales were supposed to be temporary. Some were speculating that this was Microsoft’s way of clearing the shelves to make way for the next generation of Surface tablets.
The price reductions are as follows:
- $100 off of Surface Pro
- $50 off of Surface RT bundles
- $40 off of Touch Covers and Limited Edition Touch Covers
According to ZDNet, Microsoft will be rolling out these price adjustments in phases, “in order to meet customer demand and retailer expectations.”
Microsoft recently reported having posted a $900 million charge for unsold inventory. The company specifically pointed to mobile device as an area where they need to make improvements. Microsoft’s new chief financial officer, Amy Hood, was quoted as saying, “That’s a big reason we made the strategic organizational changes last week.”
Forrester’s recent report on mobile app development activity noted that many developers are just skipping Microsoft’s RT altogether when deciding which operating systems to make apps for.
It is possible that the company has finally admitted defeat in the tablet market and is trying to recover as much investment as possible before cutting the losses.