Microsoft Confesses: Surface Tablet Could Impact Partner Relationships
Well, at least the collective tech press isn't completely nuts. As soon as Microsoft used a hush-hush event to reveal the Surface tablet (both of them, actually), the first thought wasn't about Microsoft following Apple, or even Windows 8 on a tablet. It was: "What will Microsoft's OEM partners think?" Indeed, Microsoft has survived and thrived for decades on the backs of other companies. What's Windows without an HP, Asus, Acer, Toshiba, Lenovo, Dell or [Insert Partner Here] shell? Microsoft has steered clear of hardware design and manufacturing (mice and accessories notwithstanding), and it seems logical to assume that much of that decision was simply made to not irritate those all important partners. Or at least that was the model...
In the latest Microsoft report issued to the U.S. Securities and Exchange Commission, Microsoft actually opened up and admitted the obvious: that the Surface tablet may "weaken support for Windows among Microsoft’s partners in the PC industry, known as original equipment manufacturers, or OEMs for short." That's according to the New York Times, who also quotes Microsoft as saying that its Surface devices "will compete with products made by our OEM partners, which may affect their commitment to our platform."
Those notable lines are just a couple in a document that is around 100 pages long, but they're meaningful. Microsoft is being open about the fact that the very partners it relies on to sell Windows-based laptops and desktops will now be competing with Microsoft in the tablet race. It certainly won't be comfortable, and you can bet that Microsoft will have a lot of explaining to do, and perhaps even some concessions to make to ensure steady relationships going forward.
Will it be the end to some of those OEM Windows-based laptops and desktops? Probably not, but you can bet a few behind-closed-doors discussions will go down. Perhaps Microsoft will offer Windows licenses for less to partner companies that agree to compete gracefully on the tablet front. But what if one or two of their partners go renegade, drastically undercutting the Surface in terms of price? Fireworks galore, we'd imagine.
In the latest Microsoft report issued to the U.S. Securities and Exchange Commission, Microsoft actually opened up and admitted the obvious: that the Surface tablet may "weaken support for Windows among Microsoft’s partners in the PC industry, known as original equipment manufacturers, or OEMs for short." That's according to the New York Times, who also quotes Microsoft as saying that its Surface devices "will compete with products made by our OEM partners, which may affect their commitment to our platform."
Credit: AP for Microsoft
Will it be the end to some of those OEM Windows-based laptops and desktops? Probably not, but you can bet a few behind-closed-doors discussions will go down. Perhaps Microsoft will offer Windows licenses for less to partner companies that agree to compete gracefully on the tablet front. But what if one or two of their partners go renegade, drastically undercutting the Surface in terms of price? Fireworks galore, we'd imagine.
