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No Surface Mini from Microsoft on Tuesday

Gregg Keizer | May 20, 2014
Long-rumored smaller tablet will be AWOL, sources say; instead, Microsoft will play to its strengths with new devices for power users and corporations

"Surface Pro is making some headway in corporate environments," said Ross Rubin, an independent analyst with Reticle Research, in an email reply to questions last week. "The big improvements we saw in the Pro 2 in terms of performance, thickness and battery life made it a much more appealing offering."

Rubin had also pointed out that the smaller-screen market was "a tough, competitive space," and that Microsoft's biggest selling point for Surface, its Office franchise, would have little impact on devices with 7- or 8-in. displays.

Declining to sell a Windows RT-powered Mini not only keeps Microsoft out of the fierce price wars of smaller tablets, but may also be a recognition that the devices are already on the decline. While smaller tablets will continue to account for the majority of those shipped in each of the next five years, their share of the total will continue to shrink as they face pressure from larger-sized smartphones, according to IDC. Part of the small-tablet decline has been attributed to the rise in popularity of bigger smartphones, those with screen sizes 5-in. and larger.

But Microsoft will forgo some benefits by not going low.

"They have to be successful in a smaller format to drive scale," said Patrick Moorhead, principal analyst at Moor Insights & Strategy, in an interview last week. "You have to have scale to buy cheaper components. Right now, Microsoft doesn't have the scale to be profitable or to hit interesting price points."

"There is a downside in not playing in that [smaller] space at all," said Carolina Milanesi, chief of research at Kantar WorldPanel Comtech, when asked today a "what if?" about a lack of a smaller Surface. "But in terms of timing, perhaps there is not a downside. That market may just not be a valuable market for Microsoft at the moment, perhaps because they haven't decided how to drive value around that form factor."

Rather than risk the Surface brand's reputation — which has consistently been about top-tier hardware and the best-possible Windows experience — in trying to play in the lower prices, Microsoft could, Milanesi said, use its newly-acquired Nokia division for that market.

Microsoft will webcast its New York presentation tomorrow, starting at 11 a.m. ET (8 a.m. PT).


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