Microsoft has slashed the price of its very first tablet computer, the Surface RT. The device can now be purchased for just $349 — or $150 less than its original retail price. That’s good news for consumers but bad news for Microsoft, which recently revealed it has lost almost $1 billion producing the device.
The Surface RT launched alongside Windows 8 last fall. The device, which uses a slimmed-down version of Windows 8 called Windows RT, stumbled out the gates. The problem: Windows RT users can only download apps through Microsoft’s Windows Store.
Also, Microsoft revealed that it was working on the beefier Surface Pro, which made anyone buying a Surface RT feel like they’d been duped into purchasing an inferior machine.
The end result: Microsoft sold a tiny portion of the Surface RTs it expected to sell. That has left the firm with a massive inventory of unsold devices. In order to offload those Surface RT tablets and make room for a new version of the Surface, Microsoft is slashing the device’s price by $150.
It’s a tough pill to swallow for Microsoft, which recently announced quarterly revenues nearly a billion dollars short of what analysts had predicted. The major culprit appears to be the Surface RT, as Microsoft identified losses associated with the tablet to top $900 million.
But don’t you cry for Microsoft: the firm also reported revenue of nearly $20 billion, with a net income of almost $5 billion.
The lingering question is this: is the 32GB 10.6-inch Surface RT worth buying at the new price of $349?
On the surface (snicker, snicker), it’s a bargain — most other tablets in that price range, such as Google’s Nexus 7 or the Apple iPad Mini — offer comparably meager hardware specs, including smaller screens and slower processors.
However, there are other things to consider: for one, if you want a keyboard for the Surface RT, you’ll need to dole out an additional $120. The other problem is that Microsoft’s Windows Store simply doesn’t have many apps — 100,000 compared to almost 1 million over at Apple’s App Store. And it’s missing many apps iOS and Android users would consider to be essential, like Instagram.
That said, Microsoft is scrambling to beef up the Windows Store, which has grown considerably since its late 2012 launch.
Lastly, the Surface RT comes with Microsoft Office pre-installed, saving buyers $100 — which they can use to buy that keyboard.