Why Microsoft Created the Surface Tablet: No Confidence in Hardware Partners?

Microsoft’s upcoming Windows 8 operating system is centred around the tablet business which Microsoft is keen to enter, but is highly competitive. Apple’s iPad is currently running away with it as the market leader and Microsoft has ambitions to beat it. For this to happen, they need a world-class tablet market in place. However, it looks like they weren’t impressed enough with the designs from their hardware partners such as Dell, Hewlett-Packard, Acer, Asus and Lenovo, so decided to make their own tablets – the Surface based on the ARM CPU and running Windows RT and the Surface Pro based on the ubiquitous x86 CPU and running Windows 8 Pro, which also works on desktop PCs, of course.

The problem for Microsoft is that Microsoft’s Surface tablets will compete with their hardware partners who already operate on razor-then margins, which it could end up alienating, since the lack of profit may put them off the significant research and development spend required to create their own innovative and competitive designs. Hardware makers have already either discontinued efforts to make tablets due to the success of Apple’s iPad models, or are playing catch-up, so having to compete with their operating system provider as well really won’t help. Perhaps they could release their own models based on the Surface reference design in a similar way that graphics cardss are made? Only time will tell how the market shakes out.