Microsoft’s Surface is not selling, says yet another analyst

Brokerage firm Detwiler Fenton has estimated that sales of Microsoft's Surface tablet will turn out to be lower than expected for this quarter.

Although Microsoft has implemented some creative advertising strategies when it comes to its Surface tablet, such as the guerrilla-style wall art found in New York City, sales of the device are off to a slow start. On Wednesday morning, Boston-based brokerage firm Detwiler Fenton said in a research note that Microsoft is projected to sell less than one million Surface tablets for the December quarter. Detwiler referred to the Windows-maker’s strategy as “in disarray,” according to Forbes.

The firm does, however, expect that Surface sales should improve in the second half of 2013 as Microsoft improves its hardware and distribution. According to Detwiler, a lack of distribution is the largest hurdle standing in the product’s way. In fact, the firm referred to poor exposure at major electronics retailers such as Best Buy as “severely depressing sales.” The only way to purchase the Surface is through Microsoft’s website or through its small chain of retail locations.

Combined with mixed reviews and a somewhat hefty price tag this lack of exposure has held Microsoft back from reaching projected estimates of between 1 million and 2 million Surface sales. The long-time PC software maker is hitting about half of that number, as Detwiler estimates that sales are dipping into the 500,000 – 600,000 range. The upcoming Surface Pro, which will be released in early 2013, is expected to reach between 2 and 3 million in sales.

While sales of Microsoft’s first ever self-branded tablet may be looking slim, the company is succeeding in other sectors of its re-branded Windows devices. Windows 8 laptops are far outselling the Surface RT, Detwiler acknowledges. Windows Phone 8 devices are also off to a “relatively strong start” on AT&T’s network, according to the firm.

Still, Microsoft and its OEM partners are “struggling to gain traction” at Verizon. This could be attributed to a lack of interest in Nokia’s Lumia 822 and HTC’s Windows Phone 8X. Nokia’s Lumia 920 appears to be the flagship product of that brand, but it’s currently exclusive to AT&T and could remain that way for a while. As for HTC, the firm noted that its Android-based DNA has proved to be an easier sell than its Windows-based device.

Detwiler also noted that Microsoft might have to push its Surface brand into the mobile market to achieve more success, hinting that a Surface phone could be what Microsoft needs.

“MSFT needs to go into 2013 with some momentum,” Detwiler said. “And while sales are obviously headed in the right direction, we’re skeptical they are going to have much of an impact.”