The fact that Microsoft Corporation (NASDAQ:MSFT) is not a major player in the tablet market has not been lost on most people. That being said, many feel that the company has getting things right this time around by lowering its prices (get our opinion here).
When you consider no other details, it is easy to believe that slashing prices will lead to a larger number of sales. The question for Microsoft is whether or not this will actually hold true.
Digitimes recently took a closer look at what Microsoft Corporation (NASDAQ:MSFT) is trying to accomplish, adding the following information:
“Microsoft has lowered retail prices for the 10.6-inch Surface RT to US$349 for its 32GB version and US$449 for the 64GB one, but the price cut is not likely to be effective in pushing up sales because prices for Android tablets and Windows touch-screen notebooks have also dropped significantly, according to Taiwan-based supply chain makers.”
As you can see, Microsoft is not the only company thinking this way. With others also dropping their price, MSFT is not doing anything special. Unfortunately, this could end up working against them in the long run.
At this point, it is safe to say that Microsoft is hoping a price cut will accelerate sales of the Surface RT while the company prepares to launch its next generation tablets.
When it comes to the tablet market, Microsoft Corporation (NASDAQ:MSFT) is not making up much ground, if any. This latest strategy may have an impact, but as of now it is not expected to be a big one.
The same Digitimes report goes on to add the following:
“Microsoft sold about 900,000 tablets in the first quarter, and sales are believed to have dropped sequentially in the second.
In addition to Android-based tablets, falling prices for touchscreen notebooks are also expected to impact demand for the Surface RT tablets in the third quarter.”
As if the first quarter was not bad enough for sales, it appears that the second quarter was even worse. Only time will tell if this price cut my Microsoft Corporation (NASDAQ:MSFT) will help boost these numbers in the third quarter of 2013.
It is hard to say what the future holds for Microsoft in the tablet market, but right now things are not looking good. Even with prices on its tablets coming down, sales are not expected to get much better.