Surface Coming To More Retailers To Shore Up Sales

By Khurram Aziz | Dec 12, 2012 09:49 AM EST

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Microsoft has increased production of its Surface Windows RT tablet and promised to make it available to more retail outlets amid rumors of poor sales.

In a press release, the company said the Surface will come to additional retailers as soon as mid-December.

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"The public reaction to Surface has been exciting to see. We've increased production and are expanding the ways in which customers can interact with, experience and purchase Surface," said Panos Panay, general manager, Microsoft Surface. 

The news follows warnings last week from Boston-based brokerage firm Detwiler Fenton that Microsoft was nowhere near shifting the 1-2 million units of the device by then end of the year as it had hoped. Instead it would be lucky to sell 500,000 - 600,000 because the company's strategy was in "disarray".

"Lack of distribution is killing the product," Detwiler Fenton said in a research note. "Mixed reviews and a [$499] starting price tag certainly don't help, but lack of retail exposure at Best Buy and others is severely depressing sales." 

The result of the poor sales saw Microsoft slashing production by half, according to DigiTimes, and speculation that it would bring out its Surface Pro tablet earlier than the planned January 2013 date to make up for the shortfall. 

Microsoft said the Surface will continue to be available for purchase during the holidays at retail stores in the United States and Canada and online in Australia, Canada, China, France, Germany, the United Kingdom and the United States. However, the company will extend these locations into the new year, as they transition into either permanent brick-and-mortar retail outlets or specialty store locations for the Surface.

"Our plan has been to expand the retail presence for Surface after the first of the year," said Steve Schueler, corporate vice president, Microsoft Retail Sales and Marketing. "Based on interest from retailers, we are giving them the option to carry Surface with Windows RT even earlier."

The Surface is Microsoft's first venture in tablet computing, and the devices currently available run a special Windows RT version of the operating system designed for ARM-based chips.

Microsoft has followed Apple's example in opening its own retail stores, with 31 permanent outlets now open in the US and Canada as well as 34 holiday 'pop-up' stores. This still pales in comparison to Apple's 400 stores worldwide.

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