Microsoft admits Surface could sour OEM relations

Software giant's recent 10-K filing suggests firm is feeling the pressure of the mobile device revolution.

Microsoft surface

Microsoft has admitted that the release of its own-brand Surface tablet could sour relations with some of its long-standing OEM partners.

The software giant's decision to manufacture the Surface in-house, rather than outsource its development to its OEM partners, has raised eyebrows among industry watchers since the device was first announced last month.

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Speaking to IT Pro under condition of anonymity, a Microsoft insider said the move is bound to have put some of the firm's OEM partners' noses out of joint. Our Surface devices will compete with products made by our OEM partners, which may affect their commitment to our platform. "It takes a brave man [Steve Ballmer] to stand on stage and tell their hardware partners they have produced a product to compete with the iPad, [which suggests their] hardware partners didn't have the vision to do. Especially when those hardware partners got them where they are today," the source said.

However, in a 10-K filing with the US Security and Exchange Commission, to coincide with the release of the firm's financial results, Microsoft admitted the move may cause problems for the firm in the future.

"Our Surface devices will compete with products made by our OEM partners, which may affect their commitment to our platform," the firm stated.

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The company also warned that the popularity of mobile devices could make life difficult for its PC business in the future.

"The proliferation of alternative devices and form factors, in particular mobile devices such as smartphones and tablet computers, creates challenges from competing software platforms," the document continued.

"Users may increasingly turn to these devices to perform functions that would have been performed by personal computers in the past...and the prevalence of these devices may make it more difficult to attract applications developers to our platforms."

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