War of the Tablets – Microsoft Surface production troubles and iPad origins
When Microsoft surprised the whole world by unveiling its Surface tablet in an event in Los Angeles, the company put an accent on its innovative aluminum-magnesium chassis. Now, it seems that the chassis Microsoft insisted on is bringing more trouble than the company anticipated.
According to a report at DigiTimes, there are troublesome rumors spreading from the sources very close to the manufacturing well where all those Intel and NVIDIA powered Surfaces are supposed to come from. As we all know, while it is all candy dandy when western companies announce their products, but given that they're producing their wares in Far East, it is only logical where the (bad) news will come from. During the said press conference, Microsoft's Steven Sinofsky talked a great deal how the company produced the thinnest chassis in the world, using MegVapor technology, baking magnesium at ultra-high temperatures.
Unlike its competitors, such as Apple's methodology for the iPad's aluminum case, it might be that Microsoft "overdone it" in terms of mass production. According to sources in the know, MegVapor technology suffers from lower yields and producing five million cases will not be as easy as the company originally planned.
Microsoft pulled a lot of extra weight in terms of creating its first computer e.g. tablet PC, but the lack of experience is obviously costing the company a great deal. First sacrifice was to quit on the idea of launching the Windows RT and Windows 8 Pro versions together (Intel version will only follow in 3-4 months after the release of NVIDIA-powered version).
To us, this looks like typical Microsoft behavior, underestimating the engineering and manufacturing effort that takes place in creation of every product. For example, even though many engineers think of iPad as an Apple product, one of Silicon Valley's dirty secrets is a little known matter of who created the first iPad. Unlike the official stories which get repeated over and over, the first iPad was created almost five years before Apple launched the product, in a project which was backed by a large semiconductor player that wanted to have a signature product for their newly-acquired ARM division from Intel. Thus, the company went in and spend couple of million dollars, let's say six – to have a small team of people create the complete hardware product, coupled with a Linux version of operating system that ran on ARM core. Fortunately for Apple, and very unfortunately for the said company – management wasn't marvelous as the name of the company would imply and they've canned the project.
Those people left the project, got employed by Apple. Fast forward a couple of years, and there we have the late Steve Jobs with a tablet in his hand. Thus, one might think that Microsoft learned on mistakes of the past, but the company is acting more like Marvell, and less like Apple… who got almost the finished product in their hands (and still took 4 additional years to develop).
Somehow, we believe that Microsoft will have to join Boeing, its neighbor in the State of Washington and put a tight control over its supply chain. Boeing suffered a three year delay and a manufacturing catastrophe with outsourcing and offshoring key components of Boeing 787 Dreamliner and who knows, Microsoft just may be forced to do the same with its new supply chain. Because no matter what columnists of reputable publications write, to manage a hardware supply chain… it's a whole new ballgame called physics.