Just Touch It! Microsoft (MSFT) Takes Tablet Building into Its Own Hands
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Revenue Growth %: +15.0%
Overall Analyst Rating:
BUY (
Up)Dividend Yield: 0.7%
Revenue Growth %: +15.0%
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On Monday night, Microsoft (Nasdaq: MSFT) pulled off a spectacle full of mystery, excitement, and energy. All wrapped-up into a bite-sized, ground-breaking event.
The Redmond, WA-based software giant made the leap into the realm of PC sales with the unveiling of its first Microsoft-branded tablet series, its first company-branded non-gaming PC in 37 years of operations. Dubbed "Surface," the tablet hints at Microsoft's steadfast determination to unseat perennial giant Apple (Nasdaq: AAPL) from atop the tech world.
Speculation leading up to the event hinted at the sort of sentiment investors and the media had for Microsoft; at best, many expected something small and cheap to challenge the Amazon (Nasdaq: AMZN) Kindle Fire or Barnes & Noble (NYSE: BKS) NOOK series. Instead, Microsoft pulled out the big guns, aiming directly at Apple's segment-leading iPad tablet.
Surface also has a smaller, Ultrabook-type unit which will compete with offerings from Samsung and Hewlett-Packard (NYSE: HPQ), as well as Apple's MacBook Air and Pro lineups.
Microsoft's next operating system -- Windows 8 -- will debut in the latter part of 2012 and the company said it didn't want to leave any stone unturned. Windows 8 will be geared more toward the touchscreen market, like tablets and PCs. Though OEMs like Dell (Nasdaq: DELL), H-P, Asustek, and others, will have tablets ready in the third quarter, Microsoft's move underscores possible confidence issues with the licensees given past tablet sales metrics. The company said it won't hold back any features on Windows 8 or Windows RT from another OEM's tablets, keeping the playing field relatively flat.
In terms of specs, the lighter version of the Surface will run on NVIDIA (Nasdaq: NVDA) chips designed by ARM Holdings (Nasdaq: ARMH). Screen size will be 10.6-inches, versus 9.7-inches for Apple's iPad, and have memory of 32- or 64-gigabytes. Other dimensions have the tablet at 9.3 millimeters thick and weighing in at 1.5 pounds, versus 9.4 millimeters thick and 1.44 pounds for the Apple iPad. The Surface will also have a built-in kickstand and magnetic cover which doubles as a keyboard. Apple's iPad has a Smart Cover available for it, which allows for better positioning of the tablet, but does not include an integrated keyboard. Conversely, it appears Microsoft's Surface cover will not be able to fold (well, not without great effort and functionality sacrifices, anyway).
The larger version, geared toward the Ultrabook market, will run on Intel (Nasdaq: INTC) chips and come in 64- or 128-GB versions. Microsoft said the larger version will be available about three months following the ARM-based model.
Pricing is said to be comparable with current ARM tablets and Intel-based Ultrabook models.
Microsoft CEO Steve Ballmer said engineers had the motto "no compromises" when designing the tablet, wanting to exploit all features of the new OS. That means users will be able to utilize Microsoft's Office suite as well as consume bounds of media content.
It's not clear what kind of reception the Surface series will garner. Given that the market is still in its early stages and expected to double within the next two or three years, there may be room for Microsoft to make its mark. Given the success its Xbox gaming console has seen over two iterations, the one thing Microsoft has tried but been missing on is an ecosystem to rival that of Apple (and, soon, Google (Nasdaq: GOOG)). If Microsoft can hone Windows 8 into a user-friendly, fully-integrated system, who knows what might be next for the venerable software giant.
Maybe a TV set?
Shares of Microsoft are indicated less than 1 percent higher in early Tuesday trading.
The Redmond, WA-based software giant made the leap into the realm of PC sales with the unveiling of its first Microsoft-branded tablet series, its first company-branded non-gaming PC in 37 years of operations. Dubbed "Surface," the tablet hints at Microsoft's steadfast determination to unseat perennial giant Apple (Nasdaq: AAPL) from atop the tech world.
Speculation leading up to the event hinted at the sort of sentiment investors and the media had for Microsoft; at best, many expected something small and cheap to challenge the Amazon (Nasdaq: AMZN) Kindle Fire or Barnes & Noble (NYSE: BKS) NOOK series. Instead, Microsoft pulled out the big guns, aiming directly at Apple's segment-leading iPad tablet.
Surface also has a smaller, Ultrabook-type unit which will compete with offerings from Samsung and Hewlett-Packard (NYSE: HPQ), as well as Apple's MacBook Air and Pro lineups.
Microsoft's next operating system -- Windows 8 -- will debut in the latter part of 2012 and the company said it didn't want to leave any stone unturned. Windows 8 will be geared more toward the touchscreen market, like tablets and PCs. Though OEMs like Dell (Nasdaq: DELL), H-P, Asustek, and others, will have tablets ready in the third quarter, Microsoft's move underscores possible confidence issues with the licensees given past tablet sales metrics. The company said it won't hold back any features on Windows 8 or Windows RT from another OEM's tablets, keeping the playing field relatively flat.
In terms of specs, the lighter version of the Surface will run on NVIDIA (Nasdaq: NVDA) chips designed by ARM Holdings (Nasdaq: ARMH). Screen size will be 10.6-inches, versus 9.7-inches for Apple's iPad, and have memory of 32- or 64-gigabytes. Other dimensions have the tablet at 9.3 millimeters thick and weighing in at 1.5 pounds, versus 9.4 millimeters thick and 1.44 pounds for the Apple iPad. The Surface will also have a built-in kickstand and magnetic cover which doubles as a keyboard. Apple's iPad has a Smart Cover available for it, which allows for better positioning of the tablet, but does not include an integrated keyboard. Conversely, it appears Microsoft's Surface cover will not be able to fold (well, not without great effort and functionality sacrifices, anyway).
The larger version, geared toward the Ultrabook market, will run on Intel (Nasdaq: INTC) chips and come in 64- or 128-GB versions. Microsoft said the larger version will be available about three months following the ARM-based model.
Pricing is said to be comparable with current ARM tablets and Intel-based Ultrabook models.
Microsoft CEO Steve Ballmer said engineers had the motto "no compromises" when designing the tablet, wanting to exploit all features of the new OS. That means users will be able to utilize Microsoft's Office suite as well as consume bounds of media content.
It's not clear what kind of reception the Surface series will garner. Given that the market is still in its early stages and expected to double within the next two or three years, there may be room for Microsoft to make its mark. Given the success its Xbox gaming console has seen over two iterations, the one thing Microsoft has tried but been missing on is an ecosystem to rival that of Apple (and, soon, Google (Nasdaq: GOOG)). If Microsoft can hone Windows 8 into a user-friendly, fully-integrated system, who knows what might be next for the venerable software giant.
Maybe a TV set?
Shares of Microsoft are indicated less than 1 percent higher in early Tuesday trading.
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