Nice Trick, Microsoft
Oct 23rd 2012 4:35PM
Updated Oct 23rd 2012 4:54PM
Pretty sneaky, Microsoft (NAS: MSFT) .
We're now just three days away from the retail debut of the software giant's first branded tablet. Surface will rely on Windows 8 RT as its operating system, and a snappy marketing campaign as fuel.
However, the one thing that it won't rely on -- for now -- is the outside world.
As anyone that's been checking consumer electronics stores or online retailers to get a feel for Mr. Softy's new toy will tell you, Microsoft isn't selling Surface through third-party retailers.
Unlike most tablets that are easily available at local and Web-based retailers, Microsoft is limiting access to those that order from Microsoft's own website or stop by one of the dozens of namesake stores across the country.
I offered up five reasons why the Surface may fall short of expectations, and this could very well be a sixth reason. You can't sell what people can't easily buy.
However, this is actually a pretty brilliant tactic.
When Research In Motion's (NAS: RIMM) BlackBerry-flavored Playbook and Hewlett-Packard's (NYS: HPQ) webOS-championing TouchPad hit the market last year, availability across major retailers probably hurt. It wasn't long before third-party chains were bellyaching about sluggish sales, forcing HP and RIM into quickly slashing prices.
Microsoft won't have to worry about squeaky wheels or loose lips. It controls the supply. It can blur the demand.
For now, Microsoft's website shows that the first wave of Surface tablets have sold out. Depending on the model, the software giant is telling online shoppers that their orders won't ship for another one to three weeks. There will be units on hand for those that happen to live near the few Microsoft Store locations. In another shrewd move, Microsoft has been handing out free "Surface reservation pass" vouchers at the stores, guaranteeing tablets for those arriving before noon. In other words, Microsoft is doing everything it can so the stores at least give off the illusion on Friday morning that there's buzz for the tablet.
Microsoft may have a hard time moving the tablet -- at a lofty price and months before the superior line of Surface tablets rolls out -- but at least if it fails it will be a little secret that Microsoft can keep to itself.
Scratching the Surface
It's been a frustrating path for Microsoft investors, who've watched the company fail to capitalize on the incredible growth in mobile over the past decade. However, with the release of its own tablet, along with the widely anticipated Windows 8 operating system, the company is looking to make a splash in this booming market. In this brand-new premium report on Microsoft, our analyst explains that while the opportunity is huge, the challenges are many. He's also providing regular updates as key events occur, so make sure to claim a copy of this report now by clicking here.
The article Nice Trick, Microsoft originally appeared on Fool.com.Longtime Fool contributor Rick Aristotle Munarriz has no positions in the stocks mentioned above. The Motley Fool owns shares of Microsoft. Motley Fool newsletter services recommend Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.