That 'Surface will die in 2019' prediction is still a goer, says soothsayer - Kogonuso

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Oct 12, 2018

That 'Surface will die in 2019' prediction is still a goer, says soothsayer

Canalys Channels Forum 2018 Microsoft is still going to ditch or spin off the Surface line in 2019, insists the analyst who first made the prediction a year ago, despite the line-up's annual refresh this month.

"I stand by the fact that it doesn't make sense" for Microsoft to continue producing the device, said Steve Brazier, CEO at Canalys, who pointed out there is still time for his calculated guesswork to come true.

The Surface was launched during the tenure of former CEO Steve Ballmer in 2012, when he eyed with some envy the success Apple was enjoying with its Macs and iPhones.

The big bald one also presided over Microsoft's buy of Nokia to compete with Apple's dominant handset, but we all know how that went.

Apple now has low single-digit share of the total PC market, and isn't looking like the big challenger to the Windows franchise it once was, Brazier said.

"It would be much more sensible for Microsoft to stop spending money on Surface and focus on its cloud and application business where it's doing really well," he claimed. Microsoft could then pass any design ideas to its frenemies that also make PCs, Brazier added.

Senior figures at Lenovo and Dell last year told us they believed Microsoft would also get out of the Surface hardware game – perhaps that was wishful thinking on their part. It certainly looks so now.

Brazier continued: "I think [Satya Nadella] will get to that conclusion. It may need them to have a choppy quarter or two before he pulls the plug."

When the Surface launched, Ballmer described it as a design reference point to showcase Windows 8, and he predicted that a limited number of units will be sold. He possibly said this to placate chums that use its software. It got off to a choppy start, losing $900m in its first year as Microsoft wrote off Surface RT inventories.

In Microsoft's fiscal '18 ended July, Surface sales were up 16 per cent year-on-year, equating to $625m more than it sold in the prior year. El Reg estimates that Surface turned over $1bn a quarter. Microsoft did not reveal how profitable the line was.

We have asked Microsoft for comment.

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