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January 16, 2013

UBS Halves Microsoft Surface RT Sales Forecast, Says Surface Pro Will Fare Better

By Rory Lidstone, TMCnet Contributing Writer

Depending on who you ask, Microsoft's (News - Alert) Surface RT tablet is either a solid attempt to enter the tablet market or a complete failure. However, despite the tablet's solid build, quality and zippy new software, sales ultimately decide the fate of any consumer product — and Surface RT sales apparently aren't that great.

According to UBS analyst Brent Thill, Microsoft ended the 2012 holiday shopping season with "gloomy sentiment." Apparently, sales of the Surface RT were bad enough that Thill lowered his sales estimates for Microsoft's first tablet effort by 50 percent to only one million units. Thill did go on to add that he believes the upcoming Surface Pro may fare better against the likes of Apple (News - Alert) and Google in the tablet market.

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There are a number of reasons why the Surface RT hasn't done well and indeed, fierce competition from the iPad and Android (News - Alert)-based tablets, including the popular Amazon Kindle Fire, factors in heavily. Some have stated that the Surface RT's price point, which sits around that of the iPad's, is too high as anyone willing to shell out that much cash for a tablet would rather get the iPad. However, Microsoft's decision to keep the Surface RT exclusive to the Microsoft store well into December seems a more tangible reason for its poor sales.

Thill likely hit the nail on the head, though, when he mentioned the Surface Pro. The fact is, most people are probably waiting for the more capable device to be released. Sure, the Surface Pro will have worse battery life as it runs on an Intel (News - Alert) processor, but this is also its greatest strength: access to full desktop applications.

In other words, most consumers are probably asking themselves why they would want to buy the ARM (News - Alert)-based Surface RT when the Surface Pro offers a full mobile computing experience.

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Edited by Brooke Neuman
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