Who Benefits From Microsoft Surface Debut?

[dascrow]

The winners and losers are already being sorted out following the decision by Microsoft Corp. (Nasdaq: MSFT) to launch its own tablet PC. Many industry observers say the software giant's OEM customers will be the direct losers. Others say Microsoft itself may regret its move, which is likely to irritate its PC partners.

Whatever the case might be, the decision obviously has strong implications for the electronics component procurement and manufacturing segments. After seeing rivals like Hewlett-Packard Co. (NYSE: HPQ), Research In Motion Ltd. (RIM) (Nasdaq: RIMM; Toronto: RIM), High Tech Computer Corp. (HTC) (Taiwan: 2498), and even Samsung Electronics Co. Ltd. (Korea: SEC) fail to make a dent in Apple Inc.'s domination of the tablet market, component vendors are bound to hope a new competitor would be more successful in taking on the world's most valuable consumer electronics company.

Continue Reading @ EBN - Bolaji Ojo - Who Benefits From Microsoft Surface Debut?

 

[J515OP]

Strictly answering the question, everybody who is not Apple or Google. I think there are some false dichotomies in the statements, in that the question asks who benefits and then the first paragraph goes on to say OEMs will lose or MS will lose. The second paragraph tries to compare single companies against Apple which only works in the case of HP (and their own tablet) and RIM who make both their own software and hardware. The others only make the hardware.

The OEMs win because they have another market segment they can make hardware for. Given the decrease of sales in traditional PCs this should be a welcome opportunity for them for sell more new devices. MS wins because it get Windows and other MS software into a new arena. So Surface can be seen as opening a new market to both the OEMs and MS.

On the other hand, it is likely that both of the other major operating systems (iOS and Android) will lose some market share to MS. How much and in what proportion remains to be seen. So they are the "losers" in the sense that they now have another competitor in what was essentially a two horse tablet race. Applying the trends seen with smart phones it is likely that in the next couple of years Apple will be reduced to something like 30% of tablets (barring any crazy new devices they think up), with Microsoft and Google fighting over the other 70%. I'll go out on a limb and say that based on MS's success with PCs they will fare much better with tablets than phones, putting them on roughly equal footing with Android (the success of Windows RT is a huge unknown here) so that between Windows 8 and Windows RT they take 35% and Google takes the other 35%.

So again, MS wins for 35% penetration in a new market not available to them before and the OEMs win for having a 70% market share to make new devices (tablets for both Windows and Android) to replace declining PC sales.

 

[s-tabletfan]

The consumer benefits because competition is good. Like ereaders of a couple years ago. Used to be only a couple options, now they are all over the place. So the ones that got in on the ground floor were able to charge wat they wanted. The first Kindles were $350. Now the Kindle Fire is $199. Tablets are an expanding market with lots of room for growth. Technology will get better as the competition increases.