Surface Phone
Rumours about the supposed "Surface Phone" keep flying around. In my clean up post I kept things so short that all I said was basically that it isn't feasible. I wanted to add to that.
My prediction: They are working on a developer reference phone. Not a marketable device.
If Microsoft released a Surface branded phone it would need to align with the brand image Microsoft was pushing for the Surface tablet. So it would need to be a high-end, feature rich, and possible revolutionary north star product. I think if you assume it to be Surface branded that this goes hand in hand, or else you assume Microsoft knows nothing about branding, which would be insane.
So, to start... market impact. A Surface Phone would be a completely different type of disruption as a Surface Tablet. Microsoft is, above all else still the king of the Laptop and Desktop sector and Microsoft views Windows RT/8 tablets as an extension of that form factor. This is the reason they could risk introducing a product that would damage reputations with OEM's. But they weren't bold or offensive about it, they treaded very lightly indeed. The product won't ship through the same channels as their OEM's as it will only be sold through Microsoft stores. Also expect it to have a price tag near the ceiling of what Microsoft envisions these devices to sell at as another measure to ensure OEM's don't feel too threatened.
From the above it should be immediately clear why this can't be the case in mobile. They have no clout, they are still smaller than RIM in terms of market share. Even the same soft tactics would cause Microsoft to lose OEM's. At a premium price they would be hard pressed to sell a single unit though their own stores. Most hero devices would never see the sales they do without subsidies. And Microsoft has no real way to subsidize a phone. If Microsoft instead tried to sell a Surface phone through carriers with subsidies they would have no more OEM's in mobile and would stop selling OEM Windows Phone licenses... which is where Microsoft makes its real profit.
Next is OEM guidance. The tablets we saw before the Surface reveal were all bland. Many were just slightly reworked Android tablets. Uninspired hunks of garbage. Microsoft needed to set the bar for their OEM's. The Surface tablet accomplishes this. But looking at the upcoming Lumia and HTC devices... there is no need in mobile. The devices coming out won't fail because they aren't quality, innovative devices. If they fail, the ecosystem and marketing will be to blame.
Next is timing. Surface Tablets were announced months before the Windows 8 launch. This would have given OEM's at least a little time to make minor tweaks to their offerings for 1st gen products and plenty of time to take those design and feature cues into account for second gen products, thus improving the Windows 8 tablet offerings as a whole. A rumoured launch of early 2013 for a Surface Phone would have no such benefit. Also, they will have lost the hype and momentum following the launch making it bad timing even if it weren't meant as a north star product. The timing is bad in every way possible.
Lastly is historical evidence. Microsoft makes a lot of hardware and for a lot of purposes. Very little of what they do is consumer focused. For Windows Phone, Microsoft had phones made in the past as well even if they were through an existing OEM. They were simply developer phones. Handed out to entice developers to the eco-system and used internally for testing. Why would they not do the same again for WP8? Aside from the fact that a partner isn't making handsets for them... this would be identical to something which A) makes sense and B) they have done in the past. Releasing a Surface branded phone to consumers has none of those markings.
My prediction: They are working on a developer reference phone. Not a marketable device.
If Microsoft released a Surface branded phone it would need to align with the brand image Microsoft was pushing for the Surface tablet. So it would need to be a high-end, feature rich, and possible revolutionary north star product. I think if you assume it to be Surface branded that this goes hand in hand, or else you assume Microsoft knows nothing about branding, which would be insane.
So, to start... market impact. A Surface Phone would be a completely different type of disruption as a Surface Tablet. Microsoft is, above all else still the king of the Laptop and Desktop sector and Microsoft views Windows RT/8 tablets as an extension of that form factor. This is the reason they could risk introducing a product that would damage reputations with OEM's. But they weren't bold or offensive about it, they treaded very lightly indeed. The product won't ship through the same channels as their OEM's as it will only be sold through Microsoft stores. Also expect it to have a price tag near the ceiling of what Microsoft envisions these devices to sell at as another measure to ensure OEM's don't feel too threatened.
From the above it should be immediately clear why this can't be the case in mobile. They have no clout, they are still smaller than RIM in terms of market share. Even the same soft tactics would cause Microsoft to lose OEM's. At a premium price they would be hard pressed to sell a single unit though their own stores. Most hero devices would never see the sales they do without subsidies. And Microsoft has no real way to subsidize a phone. If Microsoft instead tried to sell a Surface phone through carriers with subsidies they would have no more OEM's in mobile and would stop selling OEM Windows Phone licenses... which is where Microsoft makes its real profit.
Next is OEM guidance. The tablets we saw before the Surface reveal were all bland. Many were just slightly reworked Android tablets. Uninspired hunks of garbage. Microsoft needed to set the bar for their OEM's. The Surface tablet accomplishes this. But looking at the upcoming Lumia and HTC devices... there is no need in mobile. The devices coming out won't fail because they aren't quality, innovative devices. If they fail, the ecosystem and marketing will be to blame.
Next is timing. Surface Tablets were announced months before the Windows 8 launch. This would have given OEM's at least a little time to make minor tweaks to their offerings for 1st gen products and plenty of time to take those design and feature cues into account for second gen products, thus improving the Windows 8 tablet offerings as a whole. A rumoured launch of early 2013 for a Surface Phone would have no such benefit. Also, they will have lost the hype and momentum following the launch making it bad timing even if it weren't meant as a north star product. The timing is bad in every way possible.
Lastly is historical evidence. Microsoft makes a lot of hardware and for a lot of purposes. Very little of what they do is consumer focused. For Windows Phone, Microsoft had phones made in the past as well even if they were through an existing OEM. They were simply developer phones. Handed out to entice developers to the eco-system and used internally for testing. Why would they not do the same again for WP8? Aside from the fact that a partner isn't making handsets for them... this would be identical to something which A) makes sense and B) they have done in the past. Releasing a Surface branded phone to consumers has none of those markings.
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