Microsoft Surface RT: Dumping Inventory Or Investing In Education?

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Tens of thousands of Microsoft Surface tablets with Windows RT, a device the channel has yet to see, are being sold at deeply discounted prices or simply given away to teachers and schools over the next month, prompting some to question if Microsoft's recent price slashing has more to do with unloading inventory than with pushing into the education vertical.

According to a June 19 blog post by Anthony Salcito, vice president of education for Microsoft Corp.'s Worldwide Public Sector organization, 32-GB Surface RT tablets will be available to K-12 and higher education institutes at $199 per device, down from the retail price of $499. The same device will be offered with a Touch Keyboard Cover for $249 or with a Type Keyboard Cover for $289.

"We're making a big push into education as a company," Microsoft Director of Corporate Communications Ted Ladd said. "We timed the discount for education with the teacher trade show next week. We will be giving out 10,000 devices to teachers at that event."


[Related: Surface Giveaway Goes On: Microsoft Offers WPC Attendees Deeply Discounted Tablet PCs]

Microsoft claims the generous offers are an extension of its dedication to education. Some partners on the other hand, believe Microsoft is simply attempting to unload the remaining inventory of an unsuccessful product.

"It's obviously a case where they have more inventory than they can possibly sell otherwise. It's pretty much marketing 101," said Bob Nitrio, CEO of Orangevale, Calif.- based company, Ranvest Associates.

The Surface tablet with Windows RT along with the Surface Pro with Windows 8 are two products Microsoft chose to sell directly and through select retail stores, never offering the products to channel partners.

"If they want to target a consumer market only, maybe that's the right thing for them to do," Nitrio said. "But the fact is, we have been working with HP and Lenovo and others, we have our own product stack. We have things that compete with Microsoft's hardware. There is no compelling reason for us to tell our customers, 'Go ahead and buy directly from Microsoft.'"

Nitrio argued that buying hardware from other vendors does not inhibit customers from utilizing Microsoft software platforms. Nitrio said he is seeing customers and other partners choosing to use Microsoft or its products in very small aspects or not at all.

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