Opinion: Microsoft Surface RT pricing walks a risky line

Microsoft Surface RT pricing is high enough that the tablet may be a tough sell, but low enough to be competitive.

It's not the pricing I had hoped for. But, at the same time the price options for the Surface RT tablet are not ridiculous. The pricing of the Surface RT tablet is competitive--not high enough to be dead on arrival, and not low enough to be a slam dunk.

According to details available on the Microsoft Store site earlier today, the Surface RT will start out at $499 for a 32GB model without the accompanying keyboard case. Without diving deeper into the features and capabilities, that makes the Surface RT $100 cheaper than the similar 32GB iPad, which costs $599.

That pricing falls in line with a statement earlier this year from Microsoft CEO Steve Ballmer that the Surface tablets pricing would be roughly in line with the competition. At that price, the Surface RT is "competitive", but so far nobody has really had any hands-on experience with an actual Surface RT tablet, so the proof will be in the proverbial pudding.

There was some speculation that Microsoft would take a loss and price the Surface RT very aggressively in the $200 range. Such a bargain would be a double-edged sword, though, for Microsoft. It would virtually guarantee success out of the gate, and establish market share for the tablet newcomer, but it would also be difficult--if not impossible--to get people to pay a more reasonable price in the future once the $200 bar has been set.

At $499 for a 32GB model, Microsoft is delicately straddling the line. Any more expensive, and I'd say it has little chance of succeeding. Any cheaper, and Microsoft might be cutting it's own throat for short-term gains. I still think $499 might be a bit high for an untested device, but I think a lower price would be risky for Microsoft and its OEM partners.

The "untested" part is the big question mark that still looms. If the Surface RT lives up to the expectations set when Microsoft unveiled it, $499 might be a bargain. That's a big "if", though. One thing the Surface RT has that will weigh heavily in its favor is the suite of Office apps included for free. If the rest of the Office RT apps are anything like OneNote MX, that alone could be a selling point that makes the Surface RT seem cheap at $499.

The Surface RT pricing was apparently posted online prematurely, because Microsoft quickly took the information down. It seems that Microsoft marketing also jumped the gun a bit, because there are ads running here on PCWorld that claim the new tablet is available for pre-order with a button to click that says "Buy Now". If you visit now, though, it just directs to a Microsoft Store page that says the Surface is "coming soon".

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Tony Bradley

PC World (US online)
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