Here’s a non-surprise: Microsoft is discounting its line of Surface Pro 2 tablets by $100 to $200, configuration depending. When Microsoft announced the Surface Pro 3, a device that has received stronger reviews by the media than its predecessors, we asked if it would continue to sell the Surface Pro 2. The company replied with the following comment: “Surface 2 and Surface Pro 2 remain great options and will stay in market at this time.”
However, given that the Surface Pro 2 was selling for a higher base price than the Surface Pro 3, which is currently available for pre-order, I predicted that the company would reduce the price of the now-dated, second-generation device. I award myself five analyst points.
Given that the company has long known that the Surface Pro 3 was coming, it being is progenitor and all, let’s hope the company slowed production of the Pro 2, and thus doesn’t have much inventory to get rid of.
I often forget that Surface is a money-losing venture thus far. In Microsoft’s fiscal fourth quarter of 2014, that’s our calendar fourth quarter 2013, Surface had revenue of $893 million. The cost of that revenue totaled $932 million. In its third fiscal quarter, our calendar first quarter, Surface revenue totaled $494 million. Cost of revenue: $539 million. Those cost figures don’t include marketing costs and so forth.
Microsoft didn’t reply to a request for comment by the time of publication.
Update: Microsoft responded to our request for comment with the following quip: “Microsoft retail stores are all about providing the best choice, value and service for our customers. As we anticipate the arrival Surface Pro 3, we know that Surface 2 and Surface Pro 2 remain great options – we’re pleased to offer this promotion as a way for people to get an even better value on a great device.”