Yesterday everyone got crazy when Engadget put the price of $199 for the entry level tablet running Windows RT in the room. When you look at the article you will notice that it is typical link bait material. A headline that gets everyone crazy, anonymous sources, and no confirmation from a trusted source or even a hint of evidence.
The Surface RT tablets ship with 32 or 64 Gigabytes of storage, 10.6-inch ClearType HD display, micro SD, USB 2.0 and a limited pre-installed version of Office 2013. Compare that to tablets priced for $199, like the Google Nexus 7, which ships with a 7-inch display, and 8 or 16 Gigabytes of storage, and you will notice that the $199 is not going to happen.
When you look at 10-inch tablets, you enter the realm of what Microsoft's Surface RT tablet will likely be priced liked. The Samsung Galaxy Tab 2 10.1 for instance retails for $489 with 16 Gigabyte of storage, the latest iPad at $499 with 16 Gigabyte of storage as well.
Even if Microsoft subsidizes the tablet, it would come nowhere near the reported retail price of $199. If Microsoft subsidizes the tablet, it could retail for $399 or maybe $449, but below that? I can't see that happening, not for the specs the device ships with and even with the prospect of earning money from in-store purchases. As you know, Windows RT users are limited to the Windows Store when it comes to getting applications for their device, and Microsoft gets a cut of 30% of the first 25,000 in sales, and 20% thereafter.
If Microsoft prices the Surface RT too competitively, it could damage OEM relations and support for the device. A $199 Surface RT for instance would leave no room for OEMs to make a profit selling their Windows RT devices, especially since they do not have the second revenue opportunity that Microsoft has thanks to the Store concept.
What I can see happening is that Microsoft will price the Surface RT tablet at the same price point as Apple's iPad and Samsung's entry tablets. What's your take on this? How much do you think will the Surface retail for when it comes out October 26 alongside the Windows 8 operating system?
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Ghacks is a technology news blog that was founded in 2005 by Martin Brinkmann. It has since then become one of the most popular tech news sites on the Internet with five authors and regular contributions from freelance writers.