Ballmer admits the Surface RT flopped

“We built a few more devices than we could sell,” admitted Ballmer when referring to the slow Surface RT sales. Microsoft recently cut the price of its Surface RT tablets by 30 percent worldwide, and Ballmer and Turner reiterated in the internal meeting that the huge writedown was a price adjustment that was necessary to sell Surface RT devices. While Ballmer didn’t provide a sneak peek at the next Surface, we’re told he confirmed new devices are currently being tested with incremental improvements.

So Microsoft took a $900 million writedown because the Surface RT sucks balls and in response the next version of the Surface will have “incremental improvements.” Perfect.

UPDATE: I updated the headline and post to better reflect Ballmer was talking about the Surface RT.

  • Martin Johnson

    That’s what you like to hear about the next version of a failed product “incremental improvements”.

  • Jeff Slater

    Microsoft still doesn’t get it. The Surface isn’t gonna compete with the iPad until they get rid of the legacy garbage – the Windows desktop. It’s funny, their greatest asset (being legacy Windows software) and the best selling point of their tablets is also its achilles heel…

    They really should have gone the route Apple did – scaling up Windows Phone and keeping Windows separate from their tablet OS.

    • matthewmaurice

      In Microsoft’s defense, they’re a perfect example of the old adage “when your only tool is a hammer, all your problems resemble nails.”

    • Mikey

      It really started that way with Metro, but somewhere in corporate hell, the refusal to let go of the trapeze to get to the next one didn’t happen. I wonder who sold that idea? Or didn’t sell Balmer on the need to let go of Windows. Steve Jobs seemed to live for the rush of the moments between trapezes; while a quieter personality, it seems Cook is comfortable there as well (e.g. iOS7)

  • GadgetGav

    So they drop the price to encourage sales, and then confirm that there’s an improved model close to release… I wonder how that’s going to work out for them.

  • The Surface will get Zune’d by the end of next year. Their next trick will be putting a 12″ screen on the XBox console to see if that works—the big selling point will be that you can plug it into your TV to play games, or plop it in a wheelbarrow to take it with you.

    • “Zune’d” >snort< 🙂

      • Blinx182


  • Sigivald

    To be fair, you have to distinguish “Surface” from “Surface RT”.

    The RT purely sucks.

    The Surface non-RT only kinda sucks; incremental improvements to that might make it profitable, if lowish volume – but not competing with the iPad.

    (I’ve actually used Win 8 on a tablet, as we have a crappy Iconia W3 for mobile testing of a Point-of-Sale product in my office.

    I’d never, ever want to use it for anything like “Windows” work. It’d probably be okay for “Tablet stuff”, but iOS does that better.

    But for some uses, it’ll fill a useful niche, and MS could make a profit doing that.)

    • Moeskido

      Somehow, I think if you tell most consumers they “have to distinguish ‘Surface’ from ‘Surface RT,'” or that “the Surface non-RT only kinda sucks,” they’ll simply go buy something else.

  • The SurfaceRT has been my PC and tablet for the last year and it works brilliantly. Microsoft just need to get their messaging right.

    • GadgetGav

      Do you want to buy 2 million more? They’re going cheap..! 😉


      It is always fault of the consumer never Microsoft. repeat that forever.

  • Doctorossi

    “We built a few more devices than we could sell,” admitted Ballmer when referring to the slow Surface RT sales.

    Hey, Steve, can I borrow “a few” bucks?

  • lucascott

    I’m trying to wrap my head around ‘a few more’

    If ‘a few more’ is almost 2 million what does it take to get to ‘a lot’

  • Moeskido

    I’m guessing Ballmer believes the device is good enough, and that his Sales and Marketing monkeys merely need to double down on their “message” and somehow convince the rest of us that we’re all wrong about it.

  • ysengrain

    “We built a few more devices than we could sell”. Ballmer is managing µSoft since ? What a clearsightness !!

  • darwiniandude

    Ok. So I’m generally pretty anti-Microsoft.

    But how about this:

    Microsoft may have known Surface RT would flop – but they knew they had to release it anyway.

    Two points: 1. Microsoft must have been working on Surface RT for years. Windows doesn’t get ported to ARM by itself you know. And if Intel failed to produce X86 chips that would compete with ARM on performance per watt, then Microsoft needed to have Windows RT ready for future devices.

    1. When they launched this dual Surface Pro / Surface RT deal, I was incredulous. Surface RT looks like Windows, but doesn’t run your windows apps. Surface Pro looks like an iPad, but is thick, heavy, has a fan and gets warm, short battery life, viruses, etc. Surface Pro is too close to what Microsoft has been doing since 2003 with Tablet PC, or since 1992 with Windows For Pen Computing.

    So my point 2 is as follows: Had Microsoft released either Surface device without the other, Surface Pro traction would have been far worse than it is now. Currently, it is getting some traction in some markets.

    Had Surface RT launched without Pro, the press would have proclaimed; looks like Windows, doesn’t run Windows apps, Office RT isn’t 100% office, this is no iOS or Android killer. Can’t run windows apps would have been the number one downside, which is correct.

    If Surface Pro launched without RT, the reviews would have said that whilst its Microsoft’s own hardware, move along folks, nothing to see here. It’s just a Tablet PC as Microsoft has always made, but better due to being more modern. It doesn’t get iPad battery life, its far heavier and chunkier, there is a fan, etc.

    I think the RT specs; a Windows Tablet the size, weight and price of an iPad, and the Pro flaws; (namely size, weight, price) plus the Pro’s ability to run standard windows software (unsuitable for touch though, especially at 10.6″ and 1920×1080) canceled each other out, both in the minds of reviewers, and consumers. Remember people pre-ordered then returned RT’s once they found software didn’t work on it? They are both called Surface for a reason.

    The real product is, and always has been, the Surface Pro, and its the same idea Microsoft has been touting for a decade or more but refined due to the iPad’s influence.

    Surface RT was the Trojan horse that got people used to the idea of a Windows Tablet that could compete with iPad. And once they were used to it, it was easier to make the jump to “ahh, what’s an extra 300 grams and a few hours less battery life and more money, if I think I can run photoshop and call of duty?”

  • JR

    I have the Surface FT, purchases on July 2013. Should have saved for an iPad. The RT doesn’t power on reliably / consistently. Today it wouldn’t respond to MS instruction ‘hold button for 10 seconds, release & repeat.”. I hate this thing. Slammed it on a sofa arm & it finally powered up. I will not purchase another MS product.

  • JR