Realistic Surface RT Pricing

I know, I know... we don't really need another "Surface Pricing" thread.

I just really wanted to inject some "known knowns" into this debate which seems to be more and more based off simply what people want the Surface RT to cost rather than facts.

Facts

1. Microsoft only expect to sell "a few million" Surface tablets [source]

Microsoft only expect to grab under 1% market-share of the Windows 8/RT device sales.

Those are not the estimates of a company looking to aggressively undercut the market and grab as much market-share as possible.

2. Microsoft thinks the Windows Store will gather 100,000+ apps within 90 days of launch [source]

There has been an expectation that Microsoft may undercut their competitors in order to offset the "app gap" on such a new platform.

However it is clear that Microsoft don't think the "app gap" will exist for long.

3. All other Windows RT tablets will be between $499 and around $699

We don't know how much the Surface RT will cost, but it has been leaked by Paul Thurrott numerous times that all other tablets based on Windows RT will fall in this price range.

Based on the leaked pricing it looks like tablets in that range don't include a dock...

4. The ASUS Vivo Tab RT costs $599 without a dock [source]

And $798 with the dock. The hardware specifications of the Vivo RT are comparable to the Surface RT.

Which brings me to my final point...

5. If the Surface is under $499 there will be no OEM market

If all other Windows RT tablets are above $499 the release of a Surface RT under that price will instantly wipe out any OEM market for Windows RT devices.

My Conclusions

1. The base price for the Surface RT will be above $499

Based on the points above I would expect a price of $599 including a touch/type cover.

  • Microsoft only expect to sell "a few million" Surface tablets within 12 months
  • Microsoft doesn't think the "app gap" will exist for long
  • Microsoft won't want to destroy the OEM Windows RT market, in which all devices are priced above $499
  • A similar spec'd ASUS tablet is $599 without a dock

2. Any price under $499 will be tied to a subscription

And that doesn't mean that Microsoft will subsidize the Surface RT price to the cost of the subscription.

If we take the $99 Xbox 360 deal as an example you will still pay the same price for the device (or maybe a little more), you will just be given a lower up-front cost if you join a subscription.

One final point...

Obviously each person has their own perception of value, and for the record I think a price of $599 for the Surface RT is good value.

To me the "app gap" is more than offset by user accounts, family safety, better multi-tasking, side-by-side apps, proper support for keyboard\mouse, printers and other peripherals and Office 2013 RT.

That said, the point of this thread isn't to get into an argument about what price the Surface RT "needs to be to succeed" or if you think the Surface RT will be "DOA if it's above $XXX", but rather to lay out some facts and leaked information that seems to have been lost in the debate.