Surface kill date claims are just a "tabloid rumour"

Microsoft's Panos Panay complains that the prediction "is so far from the truth"

Microsoft's head of devices has said recent reports that the Surface range is in trouble and may be scrapped by 2019 are nothing more than "tabloid rumour".

Microsoft's Panos Panay, who has become the face of the company's hardware push, dismissed recent comments by a panel of industry experts, who argued that Microsoft's devices unit was struggling and that it would eventually kill off its Surface range.

The panel, which was made up of representatives from Dell and Lenovo as well as Canalys CEO Steve Brazier, said Microsoft would soon get sick of being in a market where it held such a low share, adding that its Surface business fell by 2% in the recent quarter and that sales were down by 26%.

Advertisement - Article continues below

The comments were reported by The Register.

However, Panay hit back yesterday, saying that the idea the Surface range would be scrapped "is so far from the truth", adding that it is the "tabloid rumour of the week", as reported by Business Insider.

Panay claimed that Microsoft's commitment to the Surface range goes beyond just selling hardware, saying efforts to improve the Surface devices have often had benefits for the entire industry. An example given was the efforts to refine the Surface Pen, which involved improving Windows 10 to work with a stylus.

Advertisement
Advertisement - Article continues below

Panay also highlighted that Microsoft's hardware has survived previous setbacks, including the $900 million loss it absorbed when it failed to sell enough Surface RT tablets in 2013.

However, Microsoft has also just officially abandoned its Windows Phone platform, despite a commitment made just last year that Microsoft would continue to support the struggling unit.

Advertisement - Article continues below

05/10/2017: Microsoft's Surface range could be in big trouble

The death knell is tolling for Microsoft's Surface range if predictions from Canalys CEO Steve Brazier are to be believed.

As reported by The Register, Brazier said Microsoft's CEO Satya Nadella is a "software guy, a cloud guy", meaning the company's tablet and laptop range is likely to go the same way as its smartphone division.

Nadella's affinity for software isn't the only reason Brazier gave for the coming demise of the Surface, though. Despite being highly rated by our own reviewers and others, Microsoft has struggled to make money on it.

"When the capital expenditure challenge that Satya Nadella has taken Microsoft down becomes visible to Wall Street, everyone will ask him Why have you gone to a low margin business?'" Brazier said.

The Surface range, he said, will be "the first target" in an apparently inevitable cost-cutting effort to reverse this low-margin trend.

Advertisement - Article continues below

Brazier's predictions were backed up by Gianfranco Lanci, corporate VP and COO of Lenovo, who joined the Canalys chief on stage.

"Microsoft is making a lot of money on cloud, making a lot of money on Windows and Office, but losing a lot of money on devices," he said.

"Frankly speaking, it is difficult to see why they should keep losing money. For them it is a very difficult exercise to run hardware products business, they need to be careful about every single detail as the margin on this is so thin."

As for when the Surface line is likely to meet its end, Lanci suggested 2019 at the latest.

Featured Resources

Top 5 challenges of migrating applications to the cloud

Explore how VMware Cloud on AWS helps to address common cloud migration challenges

Download now

3 reasons why now is the time to rethink your network

Changing requirements call for new solutions

Download now

All-flash buyer’s guide

Tips for evaluating Solid-State Arrays

Download now

Enabling enterprise machine and deep learning with intelligent storage

The power of AI can only be realised through efficient and performant delivery of data

Download now
Advertisement
Advertisement

Most Popular

Visit/infrastructure/server-storage/355118/hpe-warns-of-critical-bug-that-destroys-ssds-after-40000-hours
Server & storage

HPE warns of 'critical' bug that destroys SSDs after 40,000 hours

26 Mar 2020
Visit/software/video-conferencing/355138/zoom-beaming-ios-user-data-to-facebook-for-targeted-ads
video conferencing

Zoom beams iOS user data to Facebook for targeted ads

27 Mar 2020
Visit/software/355113/companies-offering-free-software-to-fight-covid-19
Software

These are the companies offering free software during the coronavirus crisis

25 Mar 2020
Visit/security/phishing/355120/hackers-pose-as-three-to-exploit-high-data-demand
phishing

Hackers target Three customers with "sophisticated" phishing scam

26 Mar 2020