- The Washington Times - Tuesday, June 19, 2012

Microsoft’s plan to build the first tablet computer in its history signals a possible sea change in the software giant’s strategy and risks angering some of its long-standing partners such as Dell Inc. and Hewlett-Packard Co.

The $500 to $1,000 Surface tablet will feature a 10.6-inch touch screen, virtual keyboard and kickstand while running Microsoft’s Windows 8, which industry analysts say could turn it into a rival to Apple’s Inc.’s iPad while implying an all-new business model.

The Surface, which could be released this fall, is the first personal computer that Microsoft has built on its own after dominating the software market for decades with its Windows operating system, which powers a large majority of computers around the world.

Microsoft traditionally has sold Windows to computer manufacturers, but the Surface means Microsoft could start hurting the tablet business of these partners.

“To be at a Microsoft event and not hear names like HP, Dell or Sony, it’s very strange,” said Michael Gartenberg, research director at the Gartner information-technology research and advisory firm. “It really feels like some of these folks were blindsided by this announcement.”

Mr. Gartenberg said Microsoft could be taking such a risk because it is “very concerned about the position of Windows in the market, and clearly feels very threatened about its future.”

He said Microsoft may not feel confident in its partners’ abilities to build tablets good enough to compete with Apple, so the company is taking matters into its own hands.

“That says you’re not trusting your partners,” Mr. Gartenberg said. “This is Microsoft saying this is important enough that there is a version of hardware out there that really showcases their vision of what Windows 8 should look like and what their tablet should look like.”

Jeff Kagan, an Atlanta-based technology industry analyst, called the Surface announcement “Microsoft going to war with Apple,” and noted that Microsoft, seen as the “grandpa of technology,” could learn a valuable lesson from Apple’s young and hip business model.

Microsoft, if they can follow Apple’s lead, they can win,” he said. “If they can duplicate what Apple is doing, they can be very successful.”

That would mean developing a network of smartphones and laptops to go along with the tablet, and allowing the devices to connect through the cloud, a service for which Mr. Kagan said Microsoft has many willing customers.

“If they launch it on a cloud, so consumers can start on one device and finish on another, that’s what it’s going to take to be successful,” Mr. Kagan said.

Mr. Gartenberg isn’t so optimistic and said copying Apple’s strategy will set up the Redmond, Wash.-based company for failure.

Microsoft is throwing out part of its playbook in an age when its old playbook wasn’t working very well,” Mr. Gartenberg said. “If you’re Apple, any time you can get someone to pick up your playbook, to play by your rules, and to play on your home court, that’s an advantage.”

Microsoft plans to sell the tablets at its own stores across the country rather than traditional retail chains such as Best Buy Co. Inc.

Mr. Gartenberg said this is an attempt to follow Apple’s model of selling directly to consumers through popular Apple stores, but Microsoft doesn’t have the same reach.

“Not many people live near Microsoft stores, and how many people are going to buy online without seeing it?” he asked. “At the end of the day, if Microsoft tries to be Apple, that’s not a good thing.”

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