Surface Pro 3: The Missing Link Between Productivity and Play

It only takes a flight on a commercial airline to understand Microsoft’s strategy. Look at the people around you, especially now that WiFi is available on so many flights, and you see three types of people: People with a phone in their hand playing a simple game or reading email, people with an iPad in their hand reading a book or watching a movie, and people with a notebook in their lap doing work. And if they are one of the people doing work, they are almost always doing it on Microsoft Windows and Office. So, in a world gone mad with personal electronics, the prospect of combining two needs into one device that runs MS Office is valuable and desirable.
The strategy behind the surface is also aligned with Nadella’s (Microsoft’s CEO) push of the Microsoft Cloud since he took the reigns. With Office 365 and Lync, one doesn’t have to sacrifice access, collaboration, and with them productivity, in favor of mobility. 
We probably won’t see people flocking to the stores to buy this as we would an iPad release, but give it 2-3 years while notebook users reach the end of their current life cycle and developers release more apps, and we could see the surface capture a respectable portion of both the pad and notebook markets.
Here’s today’s New York Times take on it:

Panos Panay of Microsoft on Tuesday with the Surface Pro 3, which has a 12-inch screen and aims to meld laptop and tablet. CreditMark Lennihan/Associated Press
Many people have both laptop computers and tablets and use them for different tasks. Microsoft on Tuesday redoubled its vision that the two devices should be one and the same, introducing a new version of its Surface tablet with a larger screen.


The company’s new product, the Surface Pro 3, has a 12-inch screen, larger than many small laptop screens. The more spacious screen reflects a sharpening of Microsoft’s belief that it can still distinguish itself in the tablet market, where it is currently an also-ran, with a device that meets professional and personal needs.


Microsoft argues that current tablets, most notably the iPad, are great for watching movies and other forms of entertainment or reading, but are far weaker when it comes to getting work done. The company’s proposition is that the Surface can do both well. A bigger display, Microsoft argues, will let people look at more than one application on their screens at the same time — like email and a word processor — as they can on their laptops.

Mr. Panay displaying the new Surface tablet, which the company has described as its thinnest one yet.CreditMark Lennihan/Associated Press


“We want products and technology that enable people to dream and get stuff done,” Satya Nadella, the chief executive of Microsoft, said at an event in New York.

This has been Microsoft’s approach since it introduced the original Surface in 2012, however. Earlier Surface versions had a 10.6-inch screen, larger than those on most other tablets.

Microsoft has won praise from many quarters for the design of the Surface, including a cover that also doubles as a laptoplike keyboard and trackpad. Critics of Surface say a hybrid device forces too many design compromises. Timothy D. Cook, the chief executive of Apple, once said in reference to the Surface that “you can converge a toaster and refrigerator, but these things are probably not going to be pleasing to the user.”

Sales of the Surface have been disappointing, and the company is losing money on the devices. During the first quarter of the year, Microsoft’s share of worldwide shipments in the market for tablets and two-in-one computers — tablets with detachable keyboards like the Surface — was 1.3 percent, putting it in seventh place in the market, according to IDC, the technology research firm. Apple was No. 1 with 32.7 percent.


The new Surface will start at $799, $100 less than the previous comparable version. The Surface Pro 3, which can be preordered starting on Wednesday, will be available in the United States and Canada on June 20.


Before the event on Tuesday, many people expected Microsoft to introduce a smaller Surface, to compete with the iPad Mini, the most popular product in Apple’s tablet family. Microsoft is working on such a device, according to a person briefed on the discussions who spoke only on the condition of anonymity. But the company decided against announcing the product on Tuesday, the person said, after Mr. Nadella asked the managers of the Surface team if they believed strongly that the device was ready to be shipped.


The Surface team felt the smaller device was not ready, in large part because of software issues, this person said. Microsoft has not completed a version of its Office applications for touch-screen devices running the company’s Windows operating system. Microsoft was concerned that the current Office applications would be difficult to operate on a Surface with a small screen, the person said. A version made for Apple devices has already been released.

“This continues to be a massive uphill battle for Microsoft and Nadella,” said Daniel Ives, an analyst at FBR Capital Markets. “It feels like a small step in the right direction from a product perspective and strategy perspective.”

The innards of the Surface Pro 3 include a microprocessor made by Intel, the chip giant that makes the microprocessor inside most conventional PCs. That means Microsoft’s device can run applications written for PCs, unlike the iPad and other tablets.

The new Surface will inevitably be compared with the iPad, and not favorably in many respects. At 1.76 pounds, the Surface Pro 3 is heavier and more expensive than the 1-pound iPad Air, Apple’s largest tablet, which starts at $499. Yet Microsoft believes a more apt comparison is Apple’s MacBook Air, an ultraslim laptop that is a hit among professionals and starts at $899 and weighs 2.38 pounds.

“This device actually makes a much better argument for consolidating into one device,” said J.P. Gownder, an analyst at Forrester Research.

Panos Panay, a corporate vice president at Microsoft and a creator of the Surface product line, emphasized repeatedly that Microsoft’s new product elegantly balanced the capabilities of both devices.

“I am sure that this is the tablet that can replace the laptop,” Mr. Panay said.