Lots of analysts and industry pundits have been sounding off afterMicrosoft's MSFT +2.83% Surface event in New York on Monday with anything from praise to scathing criticism. I was on hand to see the company’s new Surface 2 and Surface Pro 2 slates and I dare say I’m mostly impressed. At a base feature set and performance level, Microsoft seems to have a much better understanding of the tablet market this time around and Surface 2 and Surface Pro 2 look to be compelling solutions at the 10-inch form factor.
Alternative screen sizes aside (it has been bantered that Microsoft is considering a “Surface mini” 7 or 8-inch slate), let’s look at the more affordable Surface 2 versus the current top dog, Apple's AAPL -0.72% iPad. A 32GB Surface 2 with Windows RT 8.1, Microsoft Office RT 2013, one year of free Skype voice calling to landlines and WiFi hot spot service and 200GB of Microsoft SkyDrive for two years, will retail at an MSRP of $449. It has a 10.6-inch ClearType full 1080p HD display, 2GB of RAM, NVIDIA’s latest Tegra 4 SoC with a 72-core NVIDIA GeForce graphics engine, a microSD card slot, USB 3.0 port and HD video output.
- Microsoft Surface 2 With Touch Cover 2
That’s a pretty solid offering versus the 32GB iPad that doesn’t have direct storage expansion built in (no memory card slot), or ubiquitous USB 3.0 for $599 . Yes, Surface 2′s display isn’t as high resolution as the iPad’s retina display but 1920X1080 on a 10-inch screen is still pretty tight. Comparatively, the Surface 2 is a full $150 cheaper than the iPad, its Tegra 4 processor offersas good, if not better performance in some workloads versus the current 4th gen iPad and you get more cloud and connectivity services. It would have been a seriously strong offering if Microsoft threw in the Touch Cover 2 for the bundled price. Of course, at the low-end of 10-inch Android slates out there, you can definitely find cheaper tablets. However, all in all, I’d say Microsoft hits many of the key selling points with Surface 2.
- Microsoft Surface 2 With USB 3.0, microSD Card Slot And HD Video Output
The Surface Pro 2 is a totally different animal, with a full PC platform under the hood, Intel's INTC -1.59% Haswell CPU and a price tag to match. It competes more with hybrid detachable machines and ultrabooks, so we’ll leave that for a different discussion for now. Getting back to Surface 2, there is one more hurdle Microsoft needs to get over to really put their new tablet offering on a level playing field — a common software platform and ecosystem.
The common criticism of Windows RT is that you’re strapped to Microsoft’s less mature Windows Store and apps for Windows Phone and Windows Desktop platform aren’t compatible with Windows RT. Word on the street is that could be changing. In fact, Microsoft has reportedly been very vocal about working toward a single common API for developers across all Windows devices. When that day comes is anyone’s guess but rumors are it’s not that far off. The company knows that’s their proverbial “holy grail,” and it was evident in Microsoft Corporate VP of Surface, Panos Panay’s presentation on Monday.
Mr. Panay spoke about leveraging as many Microsoft products as possible when they were developing not only the hardware for Surface 2 but the software and ecosystem behind it. Panay demonstrated Microsoft’s Skype service with the new 3.5MP front-facing webcam on Surface 2 that handled very well in a nearly dark stage area when they brought down the house lights.
He then went on to demo Halo: Spartan Assault while running several MS Office applications at the same time and underscoring the fact that his documents, photos, etc. were always synched to the SkyDrive cloud. Throughout his presentation, Panos was beating one big drum – leveraging Microsoft’s own services and infrastructure wherever possible. SkyDrive, Office, Skype, Xbox, Windows Store; you get the idea. If you think about it, Microsoft has a pretty strong ecosystem they can leverage if they can pull the “one Windows Store for everything” model off.
We’ll see how they execute toward this goal in the coming months. Microsoft is a software company first remember. Theoretically anyway, this should be their strong suit. If they can address that last objection of a cross-device common ecosystem, Microsoft could be setup nicely to compete with both Apple and Google GOOG -0.38%. Toss in some better branding and marketing campaigns that play to the familiarity users have with Windows and you could see Surface 2 finally breaking out.
