Right now, a Surface tablet starts at $500, and the Surface Pro is planned to start at $899. For comparison, a quick look on Apple’s website showed the iPad 2 starting at $399, and even Amazon’s 8.9-inch Kindle Fire HD with 4G LTE is only priced at $499 on Amazon’s website.
For the moment, Microsoft does have a slight competitive edge in that its Surface tablets are actually hybrids with detachable keyboards, but those bump the price up even further. So, even though Microsoft recorded $6.5 billion in profit and over $21.5 billion in revenue for its second quarter of fiscal 2013, which started in October, the company has to plan carefully how to maintain that success, and stronger tablet sales seem the best choice as PC sales continue to slip.
One plan that could prove fruitful for Microsoft is to expand the Surface series — bring greater diversity. CFO Peter Klein said that company wants to offer a “greater variety of devices at a bigger variety of price points.” If Microsoft can offer Surface tablets at prices that compete better, it may be able to lean on the distinguishing keyboard feature to entice consumers away from Kindles and iPads.
Investing Insights: Microsoft’s Stock Is Boring Yet Tempting.