Microsoft shifts focus toward finished goods

By Kim Yoo-chul

Microsoft (MS) has shifted the focus of its business strategy toward finished goods to expand cash revenue from its heavy reliance on patent, platform and licensing-related businesses.

The move came after the U.S. software giant has received lukewarm responses about its lastest Windows software, the Redmond.

“We’ve been changing our business strategies,” said Kim Hyun-jung, the head of MS Korea’s Windows business unit, at a news conference in Seoul.

The remarks come after MS announced it will give Windows 8 users a free update with a host of improvements. Users have been frustrated over big changes in the latest operating system.

The strategy change was made public at the press conference designed to announce the launch of its Surface tablets.

In a statement, MS said HiMart, the nation’s top-ranked retailer selling electronics goods, will start the sale of the Surfaces from June 11.

Pre-orders will be possible between May 22 and June 7. Surface RT model using 32GB will be sold for 620,000 won, while the Surface Pro that uses 128GB will sell at 1.22 million won.

The tablets are divided into the “Surface RT” and “Surface Pro.”

Reagarding questions over Windows 8 growth and the PC industry in general, market analysts say Windows-based tablets continue “to struggle to gain traction in the market.”

Despite such a mixed outlook, MS remained bullish about the sales outlook of its latest product.

“MS believes the Surfaces are quite affordable and we are confident to see upbeat sales,” said Bryan Do, a senior executive at the company’s Korean branch, at the conference.

Korea will obtain the Surfaces later than other countries.

MS is mulling the possibility to release the next version of the Surfaces as early as June. “It’s difficult to talk about what’s next. The late entry is due to tough processes in customs and verifications of hardware specifications,” Kim said to a question from a local reporter.

Officials from the Korea Communications Commission (KCC) told The Korea Times that MS Korea had radio frequencies for the Surface tablets approved in February of this year, stating the late release was not due to local laws.

Google, which is considered MS’s biggest competitor, has been strengthening its hardware product portfolios by expanding its strategic partnership with Samsung and LG.