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All signs point to the demise of Microsoft's Surface tablet

Gregg Keizer | Jan. 27, 2015
Microsoft can finally put its billion-dollar mistake behind it.

microsoft surface

Microsoft seems to be within a whisker of calling it quits on its failed experiment with the Surface tablet, the device powered by the ARM architecture and Windows RT, an offshoot of Windows 8.

Last week, the company's own online store showed all configurations of the Surface 2 -- the lone Windows RT tablet still sold -- as out of stock, and that held as of early Monday. Best Buy, Microsoft's U.S. retail partner, also showed no Wi-Fi models available for online ordering, although spot checks had some stores with inventory for in-store pickup. And while giant e-tailer Amazon listed some Surface 2 tablets for sale, many were refurbished units, not new devices.

"It is currently out of stock [and] unfortunately we do not have specific dates on when products are back in stock, [so] you would have to check back on the site regularly," said a Microsoft Store sales representative in an online chat Friday.

Another tip-off that the Surface 2 line will be dead-ended: Microsoft will not offer an upgrade to Windows 10 for either that tablet or its predecessor, originally called Surface RT and then renamed simply Surface.

Instead, Microsoft will provide an unspecified update at some point in the future. But there will not be a path to Windows 10, the operating system slated to release later this year and which will, by Microsoft's telling, be its sole client OS for years to come.

Microsoft declined to answer questions about the Surface 2's future and whether sales had officially stopped. "There is still availability at Best Buy," a Microsoft spokeswoman said.

Analysts: It's gone
Analysts agreed that the Surface 2 and Windows RT are goners.

"It's pretty clear that we're not going to see any non-Surface Pro devices," said Stephen Baker of the NPD Group, referring to the Redmond, Wash. company's it's-a-tablet-it's-a-notebook device that runs the full Windows.

"Yes, it's dead," echoed Ezra Gottheil, an analyst with Technology Business Research.

The Surface RT was troubled from its release, and bled money almost from the start. Within nine months, Microsoft had taken a $900 million write-off to account for a glut of tablets it had to heavily discount. And even though Microsoft aggressively promoted Windows RT, it was adopted by few OEMs (original equipment manufacturers) and then quickly dropped by those who did.

But if Windows RT and the Surface 2 are dead, or nearly so, what happened? How did Microsoft make such a big blunder?

"They made enormous mistakes with both Windows 8 and what they tried to do with Surface," said Bob O'Donnell, chief analyst at Technalysis Research. "The fundamental mistake with the Surface RT was that they missed that the most important thing about a PC is that it's compatible. The Surface was incompatible with the PC, and couldn't run all the customer's legacy applications."


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