Is Microsoft expanding its hardware lineup?

With the PC market in clear decline, while tablets and smartphones are coming on strong, Microsoft is upping the game in the mobile devices space and may expand its hardware array.

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Is Microsoft expanding its hardware lineup? Ballmer says Microsoft has the clear opportunity to offer consumers a unified experience across all aspects of their life. (Getty Images)
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By  Manda Banda Published  August 29, 2013

With the PC market in clear decline, while tablets and smartphones are coming on strong, Microsoft is upping the game in the mobile devices space and may expand its hardware array.

Microsoft CEO Steve Ballmer recently announced a massive company re-organisation and may have dropped a hint about future Microsoft-built hardware.

”Our family will include a full spectrum of both partner and first-party devices,” Ballmer said in a memo outlining the rationale behind the re-organisation.

“First-party devices” could be a roundabout reference to Microsoft’s current hardware lineup of the Xbox, Surface RT and Surface Pro. But given the importance Microsoft is now placing on devices, and the size of the market it envisions, additional Microsoft hardware is at least a possibility.

“Microsoft has the clear opportunity to offer consumers a unified experience across all aspects of their life, whether the screen is a small wearable, a phone, a tablet, an 85-inch display or other screens and devices we have not yet even imagined,” Ballmer said in the memo.

In recent months, Microsoft has been rumoured to be building a touch-enabled smart watch and Xbox Surface, a 7-inch gaming tablet. There has also been talk that Microsoft will make its own smartphone.

According to figures released last month, research firm Gartner expects tablet shipments to come close to matching PC shipments by the end of 2014.

Microsoft has overhauled Windows for tablets and touch, but customers haven’t warmed to the new user interface.

Pundits say Microsoft has been “burned by outsourced manufacturing” in the past, so it wouldn’t be surprising to see it build some future devices in-house.

The big question is how future Microsoft-built devices, if they do become reality, would be sold. Would Microsoft use the Surface model of selling directly and through select retailers and large resellers? Or would future Microsoft hardware be sold through the channel?

Some Microsoft partners believe Surface was merely Microsoft’s attempt to pressure OEMs into stepping up their game in hardware design.

Microsoft COO Kevin Turner, in a keynote speech at Microsoft’s Worldwide Partner Conference held last month, said Windows 8 is 18 to 24 months ahead of the PC hardware ecosystem.

“The new market opportunity goes from 338 million PCs to 2.9 billion devices every year,” Turner said in a keynote at the conference.

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