Microsoft and computer hardware: Slowly changing to a software and devices company

Microsoft and computer hardware: Slowly changing to a software and devices company

New Microsoft Logo

Microsoft still believes that the diversity of hardware is a major differentiating factor with respect to their competitors; and in the tablet market, that primarily resides with Apple. However, more and more, Microsoft are entering into the hardware market – and while it is precisely unclear as to how serious Microsoft is with their Surface tablet computer, Ballmer stated that he expects Microsoft to sell a few million Surface devices. Nonetheless, it is interesting to consider whether Microsoft believes more in the integrated approach that Apple has always done – where the company makes both the software and also sells hardware with it.

Microsoft Surface Tablet

The integrated approach.

The benefit of an integrated approach where the same company makes both the hardware and the software is that the software can be specifically optimised for the hardware because it comes from the same company. And of course, in the case of Apple, they sell only a handful of different devices and device models meaning Apple has a very much curated selection of devices for consumers to choose from – but it also means Apple can focus their attention and energy on a small set of devices and products they sell.

Microsoft’s Surface tablet was by no means expected and was never leaked prior to being announced. It is clear that certain OEMs are not particularly happy with Microsoft’s announcement, because Microsoft’s Surface tablet is a direct competitor to the hardware devices sold by OEMs.

The benefits of the approach Microsoft has taken for a long time.

Windows has always been available on a wide variety of hardware from different hardware manufacturers and this approach made Windows an incredibly successful software platform in a very short span of time. With Apple’s approach where they make both the software and hardware seen incredible success, but not to the extent Microsoft enjoys. To me, this is because of Windows being available on a wider variety of devices from many, many hardware manufacturers: having such an ecosystem is great for the economy because there are tens of major hardware manufacturers out there selling desktops, laptops, ultrabooks and soon tablet computers with Windows preinstalled.

Surface tablet.

Original Microsoft MouseThe Surface tablet is an interesting turn for Microsoft. They have always been in the hardware market in some form or another, such as the original Microsoft Mouse released in 1983. With the Surface Pro with an x86 processor, you will be able to run all of the modern-style “Metro” applications as well as the traditional-style .NET/Win32 applications – and both the Surface and the Surface Pro come with a USB port and a Micro HD port so you can plug in an external mouse or keyboard if you want. Whether Microsoft are releasing the Surface tablets to encourage other hardware manufacturers or set the benchmark for Windows 8 tablets is unclear, but nonetheless, I do think the Surface tablet will do pretty well, economically.

Are Microsoft in the hardware business for the long-run?

I think so. It’s very similar to Google’s approach with their Nexus smartphones – it’s not heavily marketed unlike Android smartphones sold by hardware partners with Google, but their Nexus smartphones still sell very well. I do not think Microsoft are going to heavily market their Surface tablet unlike OEMs market their own products, but I can see that there will be a clear emphasis of their new Surface tablets on Microsoft’s website, during keynote conferences, etc. when the Surface and the Surface Pro are released.

 

Ben Stones

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