Deja Vu All Over Again: Microsoft Warns of Surface 2 Sell-Out

Microsoft last week warned potential customers that its second round of Surface tablets were nearing sell-out status.

Microsoft last week warned potential customers that its second round of Surface tablets were nearing sell-out status.

Microsoft Surface   2
Microsoft Surface 2

"It also looks like pre-order stock of the Surface 2 (64GB) and Surface Pro 2 (256GB and 512GB) are close to selling out -- also at Microsoft Stores," wrote Brian Hall, Surface general manager, in a blog post Oct. 2.

If by selling out, Hall meant that customers who ordered would not receive their tablets prior to the Oct. 22 public on-sale date, he was right. On Monday morning, Microsoft's online store showed the 64GB Surface 2's ship date as Oct. 25, while the higher-priced 128GB Surface Pro 2 had a ship date of Oct. 25 and the 256GB and 512GB models listed Oct. 29.

But as some have pointed out, Microsoft was essentially repeating the same message it gave to customers last year, when the Surface RT exhausted its pre-order inventories several days before the Oct. 26, 2012, debut of the tablet.

Then, Microsoft ran through its initial inventory of the 32GB Surface RT by Oct. 17, and had emptied all pre-order supplies by Oct. 20.

The problem with those sell-outs last year was that Microsoft ultimately sold far fewer Surface RT tablets than it had ordered. Although Microsoft never revealed units ordered or sold -- reports last year said the company had ordered 3 million to 5 million tablets during the fourth quarter from Asian contractors -- in July 2013 it took a $900 million write-off to account for steep discounts necessary to unload excess inventory.

In February, Microsoft ran out of the 128GB Surface Pro just days after it began selling the tablet-slash-notebook powered by Windows 8 Pro that could run legacy applications like the full-featured Office 2013 suite.

Microsoft introduced the Surface 2 and Surface Pro 2 on Sept. 23, and priced the replacements for the Surface RT and Surface Pro from $449 and $899, respectively.

New product sell-outs are not unusual in the hotspots of consumer technology, smartphones and tablets in particular. Apple's flagship iPhone 5S, which the company introduced last month, was out of stock within minutes of orders opening online. Currently, the 5S shows a ship date of simply "October" on Apple's e-store, with no specific date or date range.

Cynics, however, regularly question the legitimacy of sell-out claims, noting that it's impossible for outsiders to gauge the significance of any supply situation without knowing how many units a company allocated for pre-orders or its build orders.

Last year, when Microsoft noted that the Surface RT had sold out, NPD analyst Stephen Baker dismissed the interpretations by some that it meant sales were significant. "[Sell-outs] don't ever really mean anything," Baker said then. "They could have made just 10 of them, then said, 'We're out!'"

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, or subscribe to Gregg's RSS feed . His email address is gkeizer@ix.netcom.com.

Read more about mobile/wireless in Computerworld's Mobile/Wireless Topic Center.

This story, "Deja Vu All Over Again: Microsoft Warns of Surface 2 Sell-Out" was originally published by Computerworld.

To comment on this article and other CIO content, visit us on Facebook, LinkedIn or Twitter.
Download the CIO October 2016 Digital Magazine
Notice to our Readers
We're now using social media to take your comments and feedback. Learn more about this here.