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Microsoft Surface, Asia Awaits

Posted by: Ian Song in Personal Tech @ 2:04 PM

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Ian Song

On June 18th in Los Angeles, Microsoft introduced the Surface tablet family of products. This is the first time Microsoft has ventured into making its own tablet, which will run its upcoming Windows 8 and Windows RT operating systems.

There will be two versions: an ARM-based tablet (Surface for Windows RT) that will run Windows RT and an x86-based tablet (Surface for Windows 8 Pro) that will run Windows 8. The ARM version of the Surface, which utilizes an unnamed Nvidia processor (likely Tegra 3) will become available at the time of Windows 8/RT release around October. The x86 version (Surface Pro) will arrive about three months after the initial Windows 8 release. There was no mention of an Asia/Pacific release date, but given Microsoft's record of releasing Windows 7 as a worldwide product, it could be likely that Surface for Windows RT (Surface RT) will be available in English-based Asian markets with Windows RT's worldwide release, assuming that it has worked out its channel plans.

Effectively two different products, Surface RT and Surface Pro share very similar physical dimensions, as well as the selection of ports. The design of the device is understatedly elegant, functional, and actually quite thin (about 0.1mm thinner than the new iPad). It's obvious that Microsoft wanted to create an integrated experience for the users, starting with the operating system, then the device, and hopefully the ecosystem.

General Observations

Being the latecomer to the party has its advantages: Microsoft had two years to observe Apple and Google battling it out for the tablet space. Microsoft has learned a valuable, free lesson that Google has paid for dearly: a seamless user experience could be more difficult to achieve if an OS vendor relied on OEM partners to make the device. To that end, Microsoft is actually in the lead compared to Google in that Microsoft has taken the first step to announce Microsoft-branded Windows 8/RT tablets while Google has yet to publicly announce its not-so-secretive Nexus tablet.

Although initial impressions of the Surface tablets are good, Microsoft purposefully withheld additional information for the Surface tablets. Specifics on the pricing, battery life, and in-depth hardware configuration were not disclosed. IDC believes that this is a calculated move on Microsoft's part to incite excitement as well as provoke questions to keep interest alive. There is no doubt that Microsoft is all-in on Windows 8/RT and Surface, as shown by the amount of design and innovation that went in to the Surface tablets.

IDC believes that the Surface tablets will stand a good chance of success in the mature Asia/Pacific markets. Despite the lack of transparency on the hardware specs and pricing, what the Surface tablets offer is a true do-it-all device. The Surface could potentially offer an integrated user experience with the function of a full operating system in a compact package for users to not only consume content, but also effectively create content from anywhere. This particular use case, combined with a relatively warm reception towards Windows 8, could persuade early adopters and particularly business users (think: executives that brought iPads to work but couldn't have full access to Office, etc.) to give Surface tablets a try in markets, especially in English-speaking markets like Singapore, Hong Kong, and Australia. Other developing markets may be more price-sensitive. IDC believes that the Surface tablets may not immediately find mass market appeal, especially if it is priced at iPad-levels in these markets.

Surface for Windows RT

Microsoft's strategy of having two Surface tablets is clear; Surface RT is for the consumer market, Surface Pro is for the commercial market. In reality, this strategy won't matter as much. Given the fact that Surface RT will be available first, early adopters will get on the Windows RT bandwagon. Looking back at the iPad, where many early adopters were business users, IDC believes a similar trend might happen here.

Since Windows RT will have the Office suite built-in, as well as a myriad of business apps at launch, the Surface RT is essentially a very powerful business tool from the start. Although the Surface RT isn't compatible with traditional x86-based programs or system management, there are ways around these limitations. Solutions like client virtualization can deliver fully managed corporate Windows XP/7/8 desktop to the Surface RT, which ensures compatibility and security. In a sense, the Surface RT could be the perfect poster child for BYOD, where an employee's personal life resides local with the devices, and his/her professional life exists virtually in the corporate datacenter.

In Asia, addressing BYOD is one of the top priorities of many organizations. In many cases, the extent of BYOD begins and ends with smartphones, but personal tablet usage in the enterprise is on the rise in many developed markets. Organizations are usually wary of supporting personal devices, which could change with Surface RT and its business prowess. If Microsoft does implement a Trusted Platform Module (TPM) in Surface RT, then the device's position in the enterprise is much stronger.

The pure consumer market could be tougher to crack for Surface RT though. The Asia/Pacific tablet market is full of cheap Android devices on the low end and iPads on the high end. This market dynamic leaves Microsoft with little room to maneuver. Microsoft's Windows RT operating system will garner some attention from knowledgeable consumers, but the key to many Asian consumer hearts is through their wallets. Microsoft believes that consumers may be willing to pay a bit more to get a device that runs a full OS, but the truth is that Windows RT is not yet a proven product. If Microsoft wants to establish a beachhead of consumer users in Asia, it will need to focus on key developed markets like Australia, Korea, Hong Kong and Singapore (perhaps even leveraging local music/media acts, etc.), as well as price the Surface RT competitively with the market leader.

Surface for Windows 8 Pro

For Surface Pro, the path to success seems to be less treacherous. It will be one of the best-looking, compact PC/Tablet hybrids.  Microsoft will have more time to position and price it accordingly and it will exist in a space which Microsoft dominated for over 20 years.

As discussed in a previous IDC LINK, Windows 7 adoption across Asia/Pacific has been relatively low compared to other regions. This particular trend may pave the way for Windows 8 Pro, or at least Windows 8 Pro on Surface Pro.  While Surface Pro looks like a great fit for the enterprise on paper, the reality of enterprises buying into Surface Pro is less certain. For one, there isn't nearly enough accessories available for the Surface Pro to be full featured enterprise workhorse (like a docking station). Additionally, the pricing guideline Microsoft announced was that Surface Pro will be priced "in-line" with existing ultrabooks. This means a price range of USD 800 - 1,000 for the device, which may be out of the budget range of many organizations.

Yet, the enterprise centric features of the Surface Pro cannot be denied. The Surface Pro will be one of very few tablet form factor devices that are fully compatible with existing enterprise desktop infrastructure. The manageability, security, and compatibility aspects of the device might be reasons enough for organizations to buy into the device, or at least for the management level employees in efforts to displace the iPads, which can be a nightmare to secure and support.

At the same time, Surface Pro might actually find fans within the consumer market in Asia/Pacific. With much of the population utilizing more public transport and walk more than other regions. This means even a typical 2kg laptop becomes a burden to carry. The Surface Pro, with its relatively light weight and compact design, can serve as a multi-purpose device where consumers may use it as a computer at work, tablet on the bus, and an entertainment device at home.


Microsoft is taking a big risk with a self-branded tablet. It's clear that Microsoft doesn't want to suffer the same fate as Google's Android, having its operating system become so fragmented there is no way to guarantee the user experience. At the same time, Microsoft is heavily dependent on its hardware partners to ensure the success of Windows 8/RT, and this announcement has surely touched more than a few nerves of its partners like Acer, Asus, Dell, HP, etc. Microsoft insisted that all of its partners are aware of Microsoft's intentions, but IDC believes there will be concerns from the partners, from both the tablet and PC side about Microsoft's latest announcement.

The biggest concerns from the partners will be Microsoft's (unfair?) competitive advantage by having full control of the OS, app store and the hardware. Even if Microsoft prices the Surface in-line with other Windows 8/RT devices on the market, it will also collect licensing fees from its partners. Additionally, it will be hard for Microsoft to remain neutral when it comes to software and device updates. As Microsoft will have real time feedback from the customers, it will be able to update/fix issues for the Surface much quicker than partner's devices.

Nevertheless, having Microsoft in the tablet/PC space isn't all bad news its partners. With Microsoft wholeheartedly devoted in the success of Windows 8/RT and the Surface, it's guaranteed that Microsoft is going to invest heavily in marketing Windows 8/RT. The result may be a much bigger interest from the app developers, ecosystem vendors, and therefore consumers. At the end of the day, it will be in Microsoft's best interest to ensure its partners' Windows 8/RT endeavors flourish and the Windows 8/RT platform becomes a major player in the tablet market. Microsoft's involvement in the tablet/PC hardware space will be in effect the rising tide that lifts all boats, including those of Microsoft's partners.

In Asia/Pacific, the Microsoft's channel strategy remains unclear. Unlike the US, there are no Microsoft-owned retail stores in place in the region. While Microsoft may rely on its enterprise sales force to push Surface tablets in the commercial sector, there is no consumer market support at this time. IDC expects Microsoft may start to build other distribution channels for the Surface in Asia as the release date gets near, as well as partner with local and region retailers to sell the Tablets.

With less than six months before Windows 8/RT hits the stores, IDC expects that Microsoft will become more engaging in sharing more information on the Surface tablets. This latest announcement is just another sign that Microsoft has once again becoming an innovative company. Of course, the there are risks associated with innovations, but Microsoft is facing a do-or-die situation, where this may be the last chance it has to claim a piece of the tablet market. And Microsoft has already overcome its biggest challenge: not trying.

To learn more about IDC Asia/PAcific's analysis on Windows 8, please leave comment below, if there are enough interest, IDC will make it available.

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So Many Client Devices - Is Virtualization The Answer?

Posted by: Bryan Ma in Personal Tech @ 4:14 PM

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Bryan Ma
It's interesting. As I've engaged the industry in our research in the past couple of months, I hear two topics coming up a lot: (1) corporate infrastructure refreshes due to the economic recovery and (2) media tablets like Apple's iPad, as well as of course the iPhone and other competing products. For the former, we're already seeing some signs of business not only replacing aging fleets of PCs, but also some of them in an expansion mode and buying PCs for new hires. For the latter, it's clearly a consumer-focused market, but as we all know, consumers will oftentimes bring these devices to their IT departments in the hopes of being connected to the corporate network.

As we take a step back and look at the big picture, client virtualization enters the picture as a way that these might come together. Businesses will of course still proceed with their traditional PC-based infrastructures as the economy improves, but they also need to account for other ways for employees to access their data on a wide range of devices (including their personally-owned computers at home), and a virtualized client could be one way to address that....in theory, at least.

I say that it's in theory because some of the recent demos that I've seen out here in Asia have failed, citing problems like "unavailable connections," which only reinforced my initial hypothesis that while client virtualization is great in theory, some implementations depend critically on a network connection, which may not always be there. Don't get me wrong - client virtualization has huge benefits and I truly believe that it can be the way of the future, especially with so many consumer devices being brought to the workplace. Technology will improve (and infrastructures will get further built out), so I'm sure that usability will improve significantly in the long run, especially with many organizations in the US already adopting such technology today. In the meantime, I'd be curious to hear if you have any success stories to share - and perhaps more importantly, any best practices or policies that you've used to ensure a good experience for the user and/or IT department.

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