Microsoft finally gets the tablet right

By Leonid Bershidsky, Bloomberg

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Microsoft Corp.'s Surface Pro 3 isn't just another new tablet. It is also an impressive demonstration of the value of perseverance and part of a contrarian strategy that may yet pay off.
It's hard to get excited about new tablets these days, given that the product is almost as commoditized as smartphones thanks to the 2013 explosion in Chinese-made, Android-powered devices, which seized 62 percent of the market.
The new Surface, though, illustrates just how much Microsoft's approach differs from that of Apple Inc.'s, still the market leader in tablets. Apple prides itself on releasing products only when it's certain they are going to be hits: "It means more to us to get it right than to be the first" was how Apple Chief Executive Officer Tim Cook put it on a recent earnings call.
Microsoft, by contrast, has run with products that weren't ready for a mass audience. The first Surface tablets were resounding flops. Gizmodo reviewer Eric Limer was being generous when he wrote that the original Surface Pro "straddled the line between futurist ideal and problematic product."
Microsoft's idea was to merge the tablet and the laptop so that people would use the same device for work and entertainment. Almost everyone who owns a tablet -- 96 percent, according to Microsoft -- also owns a laptop. So buying one gadget instead of two is theoretically an attractive proposition.
With the earlier versions of the Surface, Microsoft did not make its vision practically compelling. The devices were thicker and heavier than pure tablets but not as convenient to use in a lap as normal laptops. Their screens, at 10 inches, were too small for work, the trackpads were openly hostile, and the kickstand tended to fold when you inserted your headphones. Instead of being both a laptop and a tablet, it was neither -- a laughable hybrid, like a penguin with a cat's head.
Mass-releasing the things seems to have helped Microsoft understand what it was doing wrong. The Surface Pro 3 is much thinner and lighter than the previous version. At 0.36 inch, it is marginally thicker than the iPad Air's 0.29 inch, and at 1.76 pounds it weighs about 80 percent more. It might be worth remembering, though, that the first iPad was half an inch thick and weighed 1.6 pounds. Given the bigger screen size -- 12 inches -- the Surface is now a convincing tablet.
Microsoft wants you to compare it with Apple's MacBook Air, the world's best laptop. Now that the screen-size problem has been fixed, the Surface can give it a run for its money with similar tech specs and, finally, a well-functioning kickstand and trackpad. Oh, yes, and one can actually draw on it: A digital pen is included, and it works without the irritating latency of many other tablets.
One downside is the operating system, Windows 8, probably the most user-unfriendly one since DOS. Still, the fact that it's a full version of Windows running on a powerful Intel processor goes a long way toward fixing Microsoft's biggest problem in today's app-centered market -- the fact that it does not have the wealth of mobile applications available on iOS and Android. It runs standard Windows programs just like any good laptop would, and there are plenty of those.
Microsoft has come close to making its product interesting to those who, like me, would like to use one device for working, reading, watching movies and playing casual games. While it may not have arrived at its final destination, it is clearly moving in the right direction. For someone as hooked on Apple devices as I am, Windows is still the biggest obstacle to switching. Price comes a close second: The Surface costs pretty much the same as a MacBook Air.
The money Microsoft has lost on Surface so far -- about $1.2 billion -- may well be counted as a research-and-development cost. Microsoft's reported R&D spending reached $10 billion in 2013, so make it $11.2 billion. Apple spent $4.5 billion on R&D last year, much more than in the years when the iPod, iPhone and iPad were developed, but its new products are still Schroedinger's cats. Microsoft's highly public trial-and-error method is more honest, at least to investors, than Cook's secretiveness. It is, in a sense, more collaborative, because the company gets feedback from millions of people who buy de facto beta versions of its potentially category-redefining products.
I'm rooting for Microsoft: It will be a shame if its stubbornness doesn't pay off.

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