Steve Ballmer has belatedly and half-heartedly admitted that Microsoft built far more Surface tablets than the company could possibly sell. And at the same internal Microsoft town hall meeting, he also said the obvious: Microsoft isn't selling as many copies of Windows 8 as it hoped.
The Verge reports that at the meeting, Ballmer told the assembled Microsoft employees that
"We built a few more devices than we could sell."
A few more? How does one define "a few?" Is $900 million worth of unsold inventory "a few"? That's how much money Microsoft has written off for unsold inventory of the Surface RT. Based on that amount of money, one estimate holds that Microsoft has 6 million unsold Surface tablets in inventory. To me, a six million tablet oversupply is quite a bit more than "a few."
Microsoft is trying to unload that unsold inventory by holding a fire sale, slicing prices of the Surface RT tablets by 30 percent. But Microsoft still hasn't given up on the Surface. The Verge reports that a new generation of them is being tested, with "incremental improvements." Unless those increments are big, rather than small, though, that won't help the Surface sell.
Ballmer also said about Windows 8 that "We're not selling as many Windows devices as we want to," referring to PCs, tablets, and phones. At least he didn't use the words "a few" in the sentence.
It's good that Ballmer has owned up that Microsoft has trouble when it comes to the Surface and Windows 8, albeit in a small, semi-private way. More important now, though, is some sense of how he's going to fix the problem, and in a public way, not semi-privately. People's attitudes towards a product or technology tend to harden over time. The longer that Windows 8 and Surface tablets are seen to be troubled with no solution in sight, the harder it will become for any fix to work.