Microsoft Surface Tablet More Profitable than Apple iPad

November 6, 2012, By Sanjeev Ramachandran

Did Microsoft manage to outrun Apple? According to IHS iSuppli, the software giant has scored above Apple’s iPad with its Surface tablet.

Each of the Surface tablets reportedly costs $284 to make, and each unit being sold out for $599 makes it gain almost 53 percent of profit. The third generation 32GB iPad, on the other hand, has a price tag of $599, and costs $333 to make, that is a profit of just over 44 percent.

IHS senior principal analyst, Andrew Rassweiler, stated that with a chunk of profit from sales, the Surface has kicked off Microsoft’s transformation from a software maker into a devices and services provider.“From a hardware perspective Microsoft has succeeded with the Surface, offering an impressive tablet that is more profitable, on a percentage basis, than even the lucrative iPad based on current retail pricing,” he said.

The Surface’s popularity might arise from the fact that Microsoft has coupled it with a keyboard. It makes the Surface double up as a tablet as well as a notebook PC, something which the iPad is incapable of.

The HIS has also divulged numbers pertaining to the 16GB WiFi-only iPad Mini. The latest offering from Apple retails for $329, and costs $188 to make, which would be about 40 percent of profit.

When the 32GB device is considered, the profit rises up about $90. Thus, for Apple, the iPad Mini is more lucrative than the full-sized iPad.

The firm points out that rival companies like Google and Amazon, have set low prices in an effort to gain more consumers. Microsoft and Apple, on the other hand, plan their business on a different track from what Google and Amazon are doing with their Kindle and Nexus tablets.

© 2008-2012 - All rights reserved | Privacy Policy