Market Reaction to Surface Tablet 'Muted'

The PC market is declining or staying flat as well, analysts are reporting.

Many developers are closely watching the sales figures for Microsoft's Surface tablet, trying to decide if it's worth building apps for the new platform.

Initial reports on that front aren't encouraging, but it's still too early to make any sweeping judgments.

Apple led in fourth-quarter tablet shipments, while Microsoft didn't even make the top-five list with its new Surface RT product, according to data compiled by IDC and announced today.

Microsoft entered the market as a new competitor in the tablet field during the fourth quarter of 2012, releasing its Surface RT devices to the general public on Oct. 26, 2012. In addition, some new Windows 8 machines built by Microsoft's OEM partners were released at that time. Still, IDC found that less than 900,000 Surface RT units were delivered into distribution channels during the fourth quarter.

"There is no question that Microsoft is in this tablet race to compete for the long haul," said Ryan Reith, program manager for Mobile Device Trackers at IDC, in a released statement. "However, devices based upon its new Windows 8 and Windows RT operating systems failed to gain much ground during their launch quarter, and reaction to the company's Surface with Windows RT tablet was muted at best."

Reith suggested that the prices of Windows 8 and Windows RT devices need to be lower to increase the sales volume, and that devices with smaller screens need to be built. Surface Windows RT pricing currently starts at $499, but it costs an extra $120 or $130 to add a Touch Cover or Type Cover.

Apple was the clear leader in the fourth quarter, shipping 22.9 million tablets, followed by Samsung with 7.9 million (Android plus Windows 8 tablets), with 6.0 million, Asus with 3.1 million (Android, Windows 8 and Windows RT tablets) and Barnes & Noble with 1.0 million units, according to IDC's Table Tracker report (see chart).

Chart: Top Five Worldwide Tablet Vendors, 2012Q4 Five Quarter Market Share Change (Units)Description: Worldwide Quarterly Tablet TrackerIDC's Worldwide Quarterly Tracker provides total market size and vendor share for both the Tablet and eReader markets in 46 countries. Detailed segmentation is provided by CPU, operating system, connectivity type, screen size and resolution, storage, distribution channel, and customer segment. Measurement for this tracker is in units, value, and end-user price. For more information, or to subscribe to the research, please contact Kathy Nagamine at 1-650-350-6423 or [email protected] Further detail about this tracker can be found at: Samsung, Apple, Amazon, Asus, Barnes Noble Tablet, IDC, tracker, Q4 2012, 4Q 2012, market share, galaxy, iPad, Kindle, Transformer, Nook, 2012Q4Author: IDCcharts powered by iCharts

Meanwhile, PC shipments decreased during the fourth quarter, marking the first such a decline in five years, according to IDC. Other analysts foresee a flat market for PCs for this year and the next. Gartner reported that PC shipments were down five percent in the fourth quarter at 90.3 million units worldwide.

Microsoft faced slow consumer sales after its Windows 8 launch, and its retail distribution of Surface devices initially was limited to Microsoft Stores and a few retailers, with expansion to other outlets planned for January. The company now claims to have sold more than 60 million Windows 8 licenses. Early on, Microsoft CEO Steve Ballmer had predicted that the company would see 500 million Windows 8 users by the end of 2013.

Meanwhile, Microsoft is set to begin selling its new Surface Windows 8 Pro tablets on Saturday, February 9 . The Surface Pro is the Windows 8-based x86 hardware version of Microsoft's tablet, which has PC-like computing power and the capability to run older software compatible with Windows 7.

About the Author

Kurt Mackie is senior news producer for 1105 Media's Converge360 group.

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