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Microsoft's Surface tablet may not be the hot seller the company was counting on, and the lack of channel distribution may be part of the reason why.
In a bit of good news for Microsoft, however, market researcher IDC is forecasting that Windows will capture a bigger share of the tablet market during the next few years -- but it will remain far behind Apple's iPad and Android-based tablets.
Detwiler Fenton, a Boston-based brokerage firm, issued a research note Tuesday that predicts that Microsoft is likely to sell fewer than 1 million Surface tablets in the current quarter -- with just 500,000 to 600,000 a more likely number.
HIS iSuppli is slightly more optimistic, forecasting that Surface sales will be around 1.3 million units in the fourth quarter, analyst Rhoda Alexander was quoted as saying in an interview with CNET.
Microsoft has been quiet about Surface sales since the tablet, specifically the ARM-based device running Windows RT, began shipping Oct. 26. Microsoft is scheduled to begin selling an Intel-based version of Surface running Windows 8 sometime next month.
The tablets themselves have generated mixed reviews. Some observers have pointed to what they see as the product's high starting prices -- $499 for the Windows RT tablet and $899 for the Windows tablet -- as holding back demand for the product.
But, analysts are also pointing to Microsoft's decision to sell Surface only through its website and its own retail stores as potentially stunting sales. "Lack of distribution is killing the product," the Detwiler Fenton note said. Saying that Microsoft's tablet strategy is in "disarray," the report adds: "Mixed reviews and a [$499] starting price tag certainly don't help, but lack of retail exposure at Best Buy and others is severely depressing sales."
Microsoft currently has only 31 stores in the U.S. and 34 smaller holiday specialty stores.