Microsoft Surface Pro sell-out flap: Is the tablet really that popular?

[dgstorm]

When inventory of the 128GB version of Microsoft's Surface Pro tablet dried up within hours after going on sale Saturday, there were plenty of disappointed shoppers. But there were also many skeptics who charged that Microsoft artificially created the sell-out by under-stocking the $1000 units at its online store, Best Buy and Staples.

By the way, there's no shortage of the $900, 64GB versions of the tablet.

Microsoft's official statement is that the shortage was caused by an underestimate in demand, although there were plenty of voices on Reddit who found stores with either no 128GB units or a paltry number of them for sale.

And perhaps Chris Cook of the small consumer electronics blog Product Reviews put it most succinctly: "While Microsoft would have you believe that they are working on the lack of supply problems, we’re more inclined to say that this was all part of their plan," Cook wrote.

Why hold back?
Others are discounting the artificial sell-out theory. "People build a product based on what they think can sell," Stephen Baker, a consumer electronics analyst with the NPD Group in New York City said in an interview.

"I really don't think any retailer would purposely not buy Surface Pros so Microsoft could say it was going to sell out," he added. "There's no way that would ever happen."

If retailers didn't get a lot of 128GB Surface Pros, it was because Microsoft didn't have a lot of product or because of the lackluster sales numbers for Surface RT—Microsoft's first branded tablet—retailers ordered few of the Pro, Baker said.

Supply manipulation accusations are common when a product sells out, Baker said. "There's always those kinds of rumors," Baker said. "It flies in the face of logic, if a company wants to make money."

"The goal is to sell stuff," he added, "not to pretend you sold what you didn't have."

Companies and retailers maintain inventories based on what they think will sell, Baker added. "Everybody expected that [the Surface Pro] would not be a huge seller," he said. "It's expensive and the previous product didn't do very well so anyone wouldn't have built a lot of them."

"Did they sell out because retailers only had two or three per store?" he asked. "Maybe, but I don't see anything in the previous volumes of the previous product that would indicate this was going to be a huge seller."

Continue Reading @: Microsoft Surface Pro sell-out flap: Is the tablet really that popular? | PCWorld

 

[TeknoBlast]

People can roll on the floor crying, people can jump and yell, and people can think what they want on how the Pro launch was a fail. Either way, there is a demand for the Pro whether people want to accept it or not. So to those artificial sell-out theorists, YOU CAN SUCK IT!

 

[RonNitro]

yeah, this is odd....and somewhat typical.

granted, Bellevue, WA is ground zero for microsofties and many were waiting for the Surface Pro to be released (even though all the MS Employees were given a Surface RT device last year), but the MS Store here had quite a few 128GB models in stock and no shortage of 64s at all.

From what I've heard form folks "inside" it's exactly as stated above....they missed this call. it does seem like this happens with virtually every new device release...Nexus 4, Galaxy S2, Droid2, Nexus 7, Samsung Series 9....the only thing i can remember recently that didn't have an immediate shortage is the Galaxy S3.

Much ago about nothing.

 

[J515OP]

yeah, this is odd....and somewhat typical.

granted, Bellevue, WA is ground zero for microsofties and many were waiting for the Surface Pro to be released (even though all the MS Employees were given a Surface RT device last year), but the MS Store here had quite a few 128GB models in stock and no shortage of 64s at all.

From what I've heard form folks "inside" it's exactly as stated above....they missed this call. it does seem like this happens with virtually every new device release...Nexus 4, Galaxy S2, Droid2, Nexus 7, Samsung Series 9....the only thing i can remember recently that didn't have an immediate shortage is the Galaxy S3.

Much ago about nothing.

Exactly this. Nothing new really. We don't know if MS miscalculated or not. I t could simply be a shortage for other reasons. Would everybody have been happier of MS had said "Ok guys we don't have enough of these made right now, so we are going to push the release date back a month that way there will be plenty available for everybody to buy on day one"? I can't even imagine where the wild comments would have gone then mg:

Oh and from another thread on this topic Analysts say Galaxy S III supply shortages may have robbed Samsung of 2 million units

 

[Mcfly]

So when will they become available???

 

[Grape Jelly]

I don't buy it (no pun intended). Many reviews said wait for the pro. Many people on this forum posted that not only are they waiting for pro, but for the 128 G version. Reviewers were critical of the drive size pushing people to 128 G. This product is overdue and much hyped. There were pre orders accepted by retailers. Despite all this, Microsoft supplied popular retail stores with only one of each model? If there was concern over estimating how many to ship, then why not open up preorders like they did for RT? Finally, why did stores tell people the received plenty when they clearly didn't even receive enough to cover preorders? Something is rotten here beyond just being a popular product. Again, I don't buy the story, but I will wait patiently to buy the product.

 

[Russ]

We don't know if MS miscalculated or not.

JP --

I think it's pretty clear that they did. It's easy to do -- been there; done that -- but never on such a grand scale. I think all the hype about the RT "limitations" combined with the stupid lawsuit pushed more people to the 128GB.

Trust me, folks, if you think Microsoft deliberately under-produced so they could limit the number of units sold, go outside and watch the Black Helicopters circling over your house. Get real!

Regards,
Russ

 

[leeshor]

What better way to create demand than the perceived, (or not), shortage.

 

[J515OP]

I don't buy it (no pun intended). Many reviews said wait for the pro. Many people on this forum posted that not only are they waiting for pro, but for the 128 G version. Reviewers were critical of the drive size pushing people to 128 G. This product is overdue and much hyped. There were pre orders accepted by retailers. Despite all this, Microsoft supplied popular retail stores with only one of each model? If there was concern over estimating how many to ship, then why not open up preorders like they did for RT? Finally, why did stores tell people the received plenty when they clearly didn't even receive enough to cover preorders? Something is rotten here beyond just being a popular product. Again, I don't buy the story, but I will wait patiently to buy the product.

Reviewer opinions and posts on websites don't do much to drive corporate sales practices. Pre-order by retailers was the retailer's choice and problem if they promised something they couldn't deliver. They weren't putting those through to MS for fulfillment. As you noted MS did not open up pre-orders as they did for RT so a pre-order at any level was pretty meaningless. Why do stores say they will have plenty and take your pre-order? Simple because they want to secure the sale rather than have another retailer get it. That is, BestBuy would rather have you committed to purchasing from them than going to a MS store or Staples.

What is "rotten" is nobody knows what is going on in the supply chain. MS made some changes to the Pro's design based on RT feed back. Perhaps these changes took longer to implement in manufacturing than they estimated. Maybe they ran into a supply shortage from the screen supplier or the SSD memory manufacturer. Maybe the factory works all called in sick at the assembly plant. Maybe the shipping container holding the majority of the Pros was lost at sea in a storm. The point is there are a million things that could have put MS slightly behind schedule and prevented mass shipments from reaching the stores in sufficient quantity on launch day. These sorts of things happen on a regular basis.

If this turns into a long term supply issue for MS then they could face problems even from those like yourself who are waiting patiently. More than likely though tens of thousands will start hitting the stores in the next couple of weeks and the issue will blow over. It is amazing how quickly somebody can go from being outraged about not possessing an item to not caring about supply as soon as they have that item for themselves.

Here are some blast from the past shortage examples, to keep you entertained in the meantime :wink:

Retailers' official list of this year's hot toys came out Thursday, but just try getting two of the most popular, T.M.X. Elmo and Sony (SNE) PlayStation 3.
PS3, which went on sale at midnight, was expected to sell out in minutes. Shortages are likely until spring. Retailers haven't been able to get enough Elmos since Fisher-Price's (MAT) flashy September launch.

David Allmark, general manager for Fisher-Price's licensed toys, says the Elmo shortage wasn't planned. The "totally unprecedented" reaction to the 10th anniversary Elmo "stunned" everyone at Fisher-Price, he says. "Our business is not about creating unfulfilled demand."

Shortages aren't unusual in game system launches. Manufacturers often must produce tens of thousands of units before glitches are worked out, and production delays caused Sony to reduce the number of PS3s it could ship to the USA. It hopes to have 400,000 in stores today and 1 million by the end of the year. "There are going to be some shortages," says Sony Computer Entertainment America President Kazuo Hirai. "I just need to ask for those people who couldn't get it day one to be patient."

Buyers not tickled by toy shortages - USATODAY.com

Barely one week into the official holiday shopping season, Tickle Me Elmo and Nintendo 64 are almost nowhere to be found. They sold out at some stores the day after Thanksgiving, forcing many retailers to order more shipments of the toys and causing some parents to resort to guerrilla shopping tactics to obtain them.

"(Elmo) was in our weekend ad, and he was gone the first day," said Aguinaldo, who noted that his store had stocked a few hundred of the fuzzy, giggling dolls. "I don't think he even made it past noon."

Nintendo 64, the new video game system that exploits advances in computer chip and software design to create 3-D play, has also been scarce. The system costs about $200, and each of its eight games costs about $70. Many of the 1.2 million machines the company allotted for country have already been sold.

TOY SHORTAGE - SFGate

 

[ArnoldC]

This is what I opine as Apple's reaction to the Surface Pro- Apple - Press Info - Apple Updates Processors & Prices of MacBook Pro with Retina Display

 

[Russ]

JP --

Your "blast from the past" was very relevant. It happens, but nobody does it on purpose. A time-honored axiom in business is that you never, ever, give a customer a reason or an opportunity to buy from someone else. While somebody is waiting for his Pro, Asus or the like may come out with something that attracts him -- then he is gone!

This whole discussion is borderline silly. Nah; not even borderline, just silly.

Regards,
Russ

 

[J515OP]

Russ,

I believe if you want it so badly you have to complain loudly about the lack of availability then you are going to get it no matter when. I can't see somebody being outraged and pounding their fists that they can't get a Surface Pro suddenly turning to a VivoTab and deciding that is what they really wanted all along

Of course there are time sensitive cases where a device needs to be purchased immediately but I am not talking about those as they will be very few in relative number. Honestly is getting a Pro (or any other short supply item) on day one or day 12 really that big of an issue?

The other part of the discussion is from the corporate view. Of course MS doesn't want to lose sales and while it may not be a perfect launch, it is what it is at this point and all they can do is try and get as many out as possible at this point. Does it look bad? Sure but in the end it probably won't hurt Microsoft or the Surface any. It is looking like they have a hit or at least enough of a hit that the Surface devices are going to be around for a while