The enterprise push that Microsoft announced for its Surface Pro 3 targets the device at large enterprises. It has the potential to expand an already healthy sales base.
Microsoft is stepping up its enterprise channel for the Surface Pro 3 two-in-one hybrid device, signing a global deal that will see Dell sell the unit to enterprise customers. Starting early next month in Canada and the US, Dell will sell the device and associated accessories through its North American commercial sales arm. Later this year, it will also sell the Surface Pro 3 via the Dell.com/Work website. Early next year, Dell will roll out support to the other 28 markets in the Surface commercial channel.
HP, Accenture and Avenade will also support the new Surface Enterprise Initiative, Microsoft said last week, indicating that the Dell agreement will spearhead a broader push into the enterprise market.
The deal sees Dell providing the units along with associated hardware warranty support, managed deployment, and configuration services.
“This partnership is really around enabling large enterprises to deploy the Surface at scale,” said Henrik Gütle, director of Windows and Surface at Microsoft Canada. “If you have operations in 50 countries around the world and you procure your devices from a reseller in Canada, that reseller may not be able to ship and support devices to all 50 countries,” he said. That could leave large companies are struggling to deploy the devices in a uniform way.
The Dell deal and promise of an HP partnership is significant, because both Dell and HP already sell products that compete with the Surface Pro 3. Every time those companies ship a Microsoft device, they won’t be selling one of their own. It suggests that there is space both for their own devices and for Microsoft’s, and that the additional product in their portfolio plug the gap that enables them to serve customers more readily. The financials behind the Dell deal haven’t been disclosed.
Business customers have been using the Surface Pro 3 for some time, including Michael Battista, senior consulting analyst at Info-Tech Research Group. It’s a big improvement over a company laptop, he said, and almost as pleasant to use as his iPad. The device shows real promise in the enterprise, he suggested.
“It’s interesting, because the Surface sits in the middle between laptop and tablet, not really being the best example of either. But it does mean that, in some cases, it can replace both a laptop and a tablet, ultimately reducing costs to the organization,” said Battista. “As enthusiasm for BYOD levels off, the Surface comes in as a compromise that serves the needs of an enterprise device, while acknowledging consumerisation with the look and feel of a flashy new device.”
The enterprise push for vendors of tablet devices is nothing new. Last December, Apple and IBM signed a deal to push the iPad into enterprise accounts. Unlike Microsoft’s deal with Dell and IBM, though, it included a software development component, with a fleet of iPad applications targeting particular vertical markets. Microsoft’s advantage with Windows is that it can already draw on a long line of enterprise applications available for the operating system.
Battista doesn’t feel as though Microsoft will have much catching up to do here.
“There is an AppleCare For Enterprise program that supposedly exists, but I’ve never talked to anybody who uses it. So, for once, maybe Microsoft isn’t too far behind with the Dell partnership,” he said. “A lot of organisations adopted iPads despite lack of a good Apple enterprise strategy, but now Microsoft could take advantage of the significant number of organizations that haven’t yet.”
Having said that, he sees the iPad succeeding more in the vertical market, where it has had a few years’ head start. “Organizations with tablet-specific use cases develop applications and got users accustomed to the iPad, so it would be hard to switch now.”
Microsoft’s deal with Dell covers all Surface Pro 3 devices, including one launched in the summer that featured an Intel Core i7 CPU, with 8 GB of RAM and 128 GB of storage. It doesn’t cover the Surface Hub, though, a wall-mounted device designed for boardrooms that won’t be available until the start of next year. That is more of a niche product designed for audio-visual resellers focused on meeting room collaboration, Gütle said. He wouldn’t comment on the Surface Pro 4, the next-generation hybrid device from Microsoft, which rumours suggest will be announced early next month.
Sales of two-in-one devices are soaring in an otherwise flat market. 40 vendors are shipping the devices now, compared to 14 just two years ago, according to IDC. The company expects global two-in-one sales to grow 86.5% year on year in 2015, representing 14.7 million units. That may be relatively small, but it stands out against a backdrop of stagnant PC shipments, which IDC predicts will fall 8.7% in total this year. They won’t stabilize until 2017, said the firm, meaning five consecutive years of decline by the time they pick up.
