ZDNet - Can Microsoft recover from the collapse of its Surface business?

I am surprised I missed this article from September, but I am not surprised by its news or Panos Panay’s exit from this sinking ship.

Exhibit A…

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It’s because they stopped innovating. I’ve never seen a company do this to a thriving product line. At least IBM had the sense to sell off their hardware brand when they decided they no longer wanted to be in the business. It seems as if Microsoft is just letting the Surface brand die a slow and horrible death.

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Intel had the good sense as well with their NUC line of business to sell it off rather than just let the fruit rot and wither on the vine. Microsoft just loves killing things off, be it Zune or Surface, or Clippy or Cortana (whose termination is scheduled for December 2023). Maybe Surface’s headstone will make its place amongst this illustrious set of fallen products in 2026?

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Although I’d like to believe this, it usually takes much longer for sales to reflect this (and plenty of brands just chase the industry trends and do fine).

The precipitous drop in 2022 means some other combination of major factor killed sales…maybe weak economy + BestBuy stopped pushing Surfaces? :person_shrugging:

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The innovation stopped years ago. It’s finally starting to show in sales.

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Well, looking at the timeline, they killed the Surface Book line at the end of 2021 and replaced it with the arguably less innovative Surface Laptop Studio line. The only other obvious change was Surface Duo 2, but neither it nor its predecessor broke into the smartphone market and were fire sold on a massive scale, so they shouldn’t be a factor since this is revenue, not profit. Other than that, the Surface Pro line, which has always been their bread and butter and top seller, has been getting long in the tooth with lackluster battery life and mere sRGB LCD panels being the most common complaints. What might revitalize the brand is the Surface Pro 10 if they deliver a one-two punch with OLED and Snapdragon X Elite. I only question how many people would want to purchase again after the warranty and protection plan quality of service has nosedived. There is no way they are at 2017 levels of satisfaction. We all remember when Surface led the tablet industry then. Those were the golden glory years of the brand.


https://www.jdpower.com/business/press-releases/jd-power-2017-us-tablet-satisfaction-study

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Possible to look up the JD Power charts for 2018 on?

I actually tried to find these and Google turned up a blank, so I am assuming JD Power either discontinued it around that time or only did it from then on on a private basis for its clients.

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Maybe I should have rephrased, the effect of ‘lack of innovation’ usually is a gentle downward slop, rather than a drop of the cliff.

BlackBerry is an example, lack of innovation prepped the fall, but iPhone dealt the killing blow.

So I wonder what pushed Surface off the cliff this year? If it was the collapse of warranty support, surely we’d be hearing this from the four corners of social media.

Or maybe it was a lack contract renewals from the business side? :thinking:

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The last three iterations of the Go were the same device essentially. Even the Pro line, which is still viable, stopped doing anything but swapping in new chips. The Pro X line, which was developing nicely on its own, was folded into the Pro line and lost some of its unique advantages.

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You might be onto something. That would explain why Microsoft Business support for Surface has gone downhill. No commercial revenue would mean no money to pay for their commercial support which, in turn, may be why I am now experiencing terrible support in that neck of the woods. And with that going downhill, it is just a slippery slope from there with less organizations willing to recommit to the brand when devices refresh time rolls along. Back when my family member had an issue with his 1st generation Surface Laptop Studio for Business (circa March 2022) and they were helping him, he was sent free swag even (a free Surface Dock as I recall). I am guessing when revenue started to drop, some brilliant Microsoft executive decided to slash funding for their support. Now, the whole brand is imploding in on itself, and even their business support agents are clueless and powerless script readers, all of which is a clear turnoff to organizations, especially those in critical industries who need devices replaced in a hurry. For example, I was close friends with a hospital system director in my area (Henry Ford Health) who was big on Surface in the late 2010s, but I cannot see him being all too keen on them now. If they cannot get overnight shipped replacement units when a nurse or doctor inevitably drops one (Microsoft Complete for Business Plus promises 24-hour resolution time), that means lost productivity from no device available.

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I agree. Consistently using last year’s processor finally caught up to them. Playing safe has its place in product sales, but MSFT has appeared to be almost totally risk-averse in recent years and thus Surface products have lost their aura.

I think another factor, especially in recent years, was (is) Surface’s premium price. With no real innovation to offer, why pay the price? (As an aside, my Asus Z13 has, I think, generally better components than the mid-tier Surface Studio Laptop but costs about $1000 less. That difference is hard to ignore!)

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Perhaps they’ll try to spin this as:

We started the Surface line to prompt innovation, new products such as the Lenovo Yogabook 9i and Samsung Galaxy Book 3 Pro 360 show that other companies are innovating, so we’ll just work with them to maximize licensing potential.

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As someone with more of an insight on the commercial side, Its nowhere near as bleak as you rest of you are making it out to be.

While Surface sales are down, its not just Surface, every other EOM is seeing a downward spiral in sale. Oddly enough in my little corner of Commerical space, Surface is currently out performing over every other OEM Team for most of the past year and we are still going strong.

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I can’t speak to free swag and docks being given out (which I’ve never heard of), but Commerical Support has only just recently made any changes. For the past few years, via Advanced Exchange, virtually any problem with a Surface was resolved by sending the user a replacement unit. And I can’t speak for more then 3 years ago, but as far as I’m aware Warranty/Contract renewals have never been a option.

And the Microsoft Complete Plus Plans are definitely not going away. Its not so much a 24-hour promise but a Next Bussiness Day promise, but thats not changing.

What has changed, for the newer products like the Laptop Studio 2, Go 4, Laptop Go 3, and all future products, Advanced exchange will only be included with the “Plus” plans. If a customer gets angry because they didn’t get a NBD Plus plan, its their own fault for not buying it.

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Huh…

That’s good. I was getting worried the Surface team would be so cut down, they couldn’t carry the torch for a WOA rebirth in 2024.

If you had to guess, are they planning a big Surface revamp with Snapdragon X…maybe something with all the sleek, futuristic goodness of a Pro X 2.0 chassis?

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We have heard rumors though less of late that while the Snapdragon X is definitely in future Surface plans unless they kill the line outright, which sadly seems increasingly possible, they are actually looking to go with miniLED displays for the next gen of Surface Pros. (which definitely would be a motivator for me to upgrade, less so if it’s OLED)

And…that the new displays will be part of a "major overhaul of the design, on the order of what he Pro X was to the then Pro 7

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Good catch! Just slightly editing here, I see there was a policy change for all new plans on or after September 21st of this year. Any new Microsoft Complete for Business plans as of that date do not come with any advanced exchange service unless you pay for the new optional add-on for it to add to the plan or if you instead pick Microsoft Complete for Business Plus:

Link:

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Did not know it was that high at the time, though it was indeed very unique.

Good to hear, would be a bummer if the Windows Slate/tablet market would collapse entirely. What you say about all OEMs selling less, would make sense combined with high premium price. In Europe, everything seems to be getting more expensive (more people struggle in my and neighboring countries with the high costs for consumables / food / gas / rent etc. even though we are talking about fairly rich countries where MS Surface was reasonable popular). I guess its a combination of various reasons named here.

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