Microsoft announced the Surface 3 today, a new edition to its Surface lineup of tablet-hybrids. The Surface 3 is best described as a thinner, smaller, lighter, and less-powerful Surface Pro 3.
The Surface 3 also costs less, starting at $499, sports a smaller, 10.8 inch screen, a claimed 10 hours of video playback on a single charge, and runs a full build of Windows that comes with a year’s subscription to Office 365.
The $499 price point will get you a Surface 3 with 64GB of internal storage and 2GB of RAM, but not accessories. According to Microsoft, you can double the storage and RAM for $100. The Surface 3-designed Type Cover will still cost you $129, as with the Pro 3.
The Surface 3 goes on pre-sale today, and it will be widely available for sale on May 5. That puts the device’s first financial impacts in Microsoft’s fiscal fourth quarter, or the second calendar quarter of 2015.
Materially, the devices are quite similar in look and feel. They share a shape, a form factor, nearly identical attachable keyboards, and pens. There are some differences, naturally, but the devices are clearly kin. For your enjoyment, here’s a supplied photo of Surface 3:
Surface 3
And here is a photo TechCrunch took while reviewing the Surface Pro 3:
Not Surface 3
Too close to tell? Check the lack of bezel around the Surface 3’s Type Cover, between the keys and the final edge of the product. It’s thinner, to allow for a narrower cover to fit the smaller screen of the new Surface.
Here’s a supplied shot of the keyboard, which, reminds me a bit of the new MacBook keyboard in how the keys stretch to the ends of the hardware:
Also not Surface 3, but built for Surface 3. Not for Surface Pro 3.
Going Down
Microsoft built a smaller Surface Pro 3 so that it could sell the device at a lower price point. The Surface 3, at its base price point, is 62.4 percent of the cost of its predecessor. Laboring under the presumption that the average laptop consumer is price sensitive — marginally sensitive to negative dollars as a percentage price delta between two competing devices — the move makes sense.
Microsoft declined to comment on what sort of margins it will derive from the Surface 3, and didn’t laugh at my in-meeting joke concerning it driving enough margin from the $129 Type Cover to cover other perhaps break-even devices. I kid, but keep in mind that Microsoft has planned for Surface to eventually be a profitable enterprise since the very beginning of the project.
In its most recent quarter, the company noted improving margins in its hardware work, citing increased Surface Pro 3 sales. It will be interesting to see how the Surface 3 itself shifts that language over the next few quarters.
Moving past the Type Cover built for it, the Surface 3 has its own dock like the Pro 3, but, you guessed it, smaller.
Like The Surface RT, But Not At All Like It
Microsoft has long had two Surface units on sale at any given point, formerly split between ‘Pro’ and not-Pro models, the former running Intel processors a full build of Windows while the latter ran a variant of Windows that has since been left behind. Windows RT, that now passé variant, was torn between Windows’ desktop past, and its app-based future. But, as Windows was trying to become an app platform, the device was premature and eventually doomed.
The Surface 3 runs a full build of Windows, relieving it from the core flaw of its predecessor.
That being said, for now I will register modest optimism in the Surface 3’s commercial viability. Microsoft is accepting pre-orders from a larger, 26 market pool for the Surface 3. That wider release could help the company drive increased unit volume.
We’ll go hands-on as soon as my hands are on one of the new gadgets.