A Surface Reboot? (Premium)

Five years ago, Microsoft pushed its Surface brand into the premium part of the PC business, in part to appease its PC maker partners. But in more recent years, the firm has expanded the Surface lineup dramatically and has aggressively pushed prices ever lower, first with new lower-cost versions of existing models and, more recently, with new Surface models that were designed to be more budget-conscious from inception. Is this a new strategy? Or just a natural evolution of the brand and how Surface fits into the broader market?

I’m not entirely sure. But something has changed. And from what I can tell, Microsoft is no longer shy about its desire to own a bigger chunk of a PC market that, suddenly, is pretty lucrative again. Thanks, COVID-19!

Consider the following: When Microsoft launched the Surface Pro 4 and Surface Book in October 2015, customers needed to spend over $1000 for the privilege: A base Surface Pro cost $900 plus another $130 or so for a Type Cover and, if needed, $150 for Surface Pen. Surface Book was even more expensive.

Today, the latest Pro, Surface Pro 7, starts at just $750 (again, sans Type Cover), but there are even cheaper Surface models, too: Surface Go 2 starts at just $400 (!) and the newly-introduced Surface Laptop Go starts at $550. Those aren’t just lower prices, they’re in a different pricing category all-together.

Microsoft still sells more expensive PCs, of course---Surface Book 3 starts at $1600 and you could spend around $3000 on a well-equipped 15-inch version if you’d like. But I think the more important point is that Microsoft offers far more Surface models today than it ever has. It has three 2-in-1s---Surface Go 2, Surface Pro 7, and the ARM-based Surface Pro X---three laptops (Surface Laptop Go plus Surface Laptop in 13.5 and 15-inch models), two detachable laptops (Surface Book 3 13 and 15), one all-in-one desktop, the Surface Studio, and one large-display all-in-one called Surface Hub 2S (which can be had with Windows 10 Pro or Enterprise). The Surface lineup of today bears little resemblance to the Surface of five years ago.

I often compare this model expansion to what luxury car makers like Mercedes and BMW do: Once they’ve saturated the market with every type of luxury model imaginable, they inevitably start introducing more affordable downstream models. You see that with the Mercedes A- and B-series vehicles, if you’re familiar with such things. These are the automotive equivalents of Surface Go and Surface Laptop Go, inexpensive ways to get into an otherwise unobtainable premium product line.

Surface, like Mercedes and BMW, isn’t abandoning the luxury market, of course. And the hope is that even those customers who can only afford the Go-class devices will enjoy the experience so that much that they move upmarket when it’s time to upgrade. The initial Surface Go release was perhaps a bit too lackluster to achieve this goal, but the Go 2, at least in its top-t...