Price cuts on Microsoft Surface products here to stay

Microsoft’s promotional price cut on its Surface Pro tablet is now a permanent reduction.

The discount, which lopped $100 off both models of the Surface Pro, was set to expire on Thursday. Instead, Microsoft has decided to stick with the new price, reports ZDNet’s Mary Joe Foley.

Thanks to the price cut, the 64-gigabyte Surface Pro costs $800, while the 128-gigabyte model costs $900. Formerly, the models cost $900 and $1000, respectively.

Meanwhile, Microsoft has slashed the prices of some other, related Surface products, reports Neowin, a trade publication focusing on Microsoft. The price of a bundle including a touch cover and the entry-level Surface RT tablet is now $400, down from $450 previously. And Microsoft has discounted its Surface Touch Covers — which incorporate a soft keyboard into a protective cover — by $40. The regular Touch Covers now cost $80, while a limited edition model now retails for $90.

The discounts follow the one the company put in place last month for its standalone Surface RT tablets. That device is now starts at $$350, down $150 from its original price.

The Surface products represent Microsoft’s attempt to spur sales of Windows-based tablets in an effort to meet the threat posed by Apple’s iPad and tablets running Google’s Android. While Microsoft has yet to release unit sales figures, the information it has disclosed about Surface suggest that the effort has been a costly and largely unsuccessful one for the company.

In the company’s last fiscal year, which ended June 30, Microsoft sold $853 million worth of Surface products. But it also took a $900 million charge related to unsold inventory of Surface RT tablets.

That charge, plus the cost of making the Surface devices, helped to depress the operating results of the company’s Windows division. For the fiscal year, the Windows division earned $9.5 billion on $19.2 billion in sales. In the prior year, the division earned $11.6 billion on $18.4 billion in sales.

Photo courtesy of Microsoft.

Troy Wolverton Troy Wolverton (274 Posts)

Troy writes the Tech Files column as the Personal Technology Columnist at the San Jose Mercury News. He also covers the digital media, mobile and video game industries and writes occasionally about Apple, chips, social networking and other aspects of technology. Previously, Troy covered Apple and the consumer electronics industry. Prior to joining the Mercury News, Troy reported on technology, business and financial issues for TheStreet.com and CNET News.com.