Pricing seen as key to success of Microsoft's Surface tablets

$600 for a Windows RT tablet could have customers walking away, analysts say

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"And I thought what they said about Surface looked compelling," he added. "But we don't know how compelling Surface is until we find out pricing."

Microsoft hasn't said when pricing will be announced, but if the Windows 8 operating system ships on time in October, pricing for the tablets should be known well before then, certainly by the end of August, analysts said.

Another potential value that could lure customers to the Windows RT Surface is having four free Office apps included. Microsoft has dangled the included Office apps before buyers in recent weeks, which could raise the tablet's value by $100 or more.

However, If Microsoft includes the Office apps and still charges $600 without the cover, it might end up being priced too close to the cost of the Windows 8 Pro machine without the cover, starting at perhaps $700, some analysts said. (Gold disagreed, saying that a $100 difference in price between the Windows RT Surface and Windows 8 Pro Surface is a "lot.")

If pricing for the two Surface tablets is close, buyers could get confused about which Surface tablet to pick, unless they are more sophisticated enterprise buyers who are settled on the Surface tablet for Windows 8 Pro to access Windows apps.

Possible confusion over pricing and model features isn't good, given Microsoft's precarious start in tablets.

Forrester Research's Sarah Rotman Epps criticized Microsoft for selling Windows 8 Pro and Windows RT Surface tablets in the same retail stores. Some buyers could confuse the two versions, sowing their "discontent" with Microsoft if their expectations aren't met, she said.

Sowing discontent with customers isn't a good starting point for Microsoft and its new hardware, but finding the right price for Surface tablets could serve as a form of redemption.

Mainelli summarized Microsoft's potential dilemma this way: "Microsoft believes that Windows RT tablets should command a premium price. I keep telling them that they're playing from behind both in market share and in terms of available apps.

"I'm not sure that consumers will immediately get the Windows RT story. They will think, 'So it's Windows but it doesn't run my old Windows software?' That means Microsoft has to hook customers with a great product at a great price."

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His email address is mhamblen@computerworld.com.

See more by Matt Hamblen on Computerworld.com.

Copyright © 2012 IDG Communications, Inc.

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