Microsoft Plans New Foldable Tablet, Android Smartphone -- Update
October 02 2019 - 2:25PM
Dow Jones News
By Sarah E. Needleman and Joanna Stern
Microsoft Corp. is returning to the smartphone game and plans a
suite of new wireless computing devices, including two with dual
screens that fold together like a book.
At a New York press event Wednesday, the company surprised
onlookers when it disclosed plans to re-enter the smartphone
business by the 2020 holiday season with a foldable, dual-screen
device called the Surface Duo.
Microsoft exited the phone-hardware business by late 2017,
following an unsuccessful bid to gain market share which included
buying Nokia's phone division.
The Surface Duo will run on Google's Android operating system
and feature the Google Play Store. Microsoft said it collaborated
with Google on the software and that it plans to develop its own
software to support dual-screen Android devices.
"As a company, we want to meet customers where they are. Working
with Google over the last several months has been awesome," said
Panos Panay, Microsoft's hardware chief.
A key selling point for the Duo is that it enables a user to
video chat with someone on one screen while surfing the internet on
the other, Mr. Panay said. "People need to use their phones to be
productive, but phones have their limits," he said.
The coming Surface Neo foldable tablet, also due in late 2020,
supports a magnetically attached keyboard and pen, both of which
charge wirelessly when connected to the device. It features a
processor from Intel Corp. and runs on a new version of the Windows
10 operating system designed specifically for dual-screen
devices.
Mr. Panay said the company announced the Duo and Neo a year in
advance so software developers can create apps for the dual-screen
design. Microsoft is working with cellular carriers for a 2020
release, he added.
Microsoft's Duo and Neo don't have individual screens that are
foldable. Foldable-screen devices have proven a tough manufacturing
challenge for firms including Samsung Electronics Co. Samsung is
releasing a new version of its Galaxy Fold smartphone with a $2,000
price tag, which comes after t he earlier release was scrapped in
April after screens started to break. Mr. Panay said the company is
looking into foldable screens but that there are challenges when
using plastic -- which current foldable screens require -- versus
glass.
During the presentation Wednesday, Microsoft executives focused
on the ability for Surface users to move seamlessly from work and
personal tasks within devices.
Wedbush analyst Dan Ives described Surface as "the tip of the
spear" across Microsoft's broader ecosystem, which includes the
Office 365 suite of products including Word and PowerPoint.
Microsoft's devices category, which includes Surface products and
Xbox, generated $6.1 billion in revenue in the year ended June 30,
up from $5.13 billion a year earlier. "This remains a mind and
market share strategic gamble for Nadella & Co. that is in the
early stages of playing out," he said in an investor note.
At the event, Microsoft also showed off expected updates to its
Surface laptops and tablets, due out in the coming months.
Devices that can double as a tablet or laptop account for about
10% of the PC market, research firm International Data Corp. said
in September. World-wide shipments of so-called 2-in-1 devices are
also expected to grow at a faster rate than the broader PC market
through 2023, according to IDC data.
Also joining its peers, Microsoft plans to sell wireless earbuds
later this year. The voice-enabled round earbuds would start at
nearly $250 and have 24-hour battery life, the company said. Its
announcement comes a couple of weeks after Amazon unveiled new
wireless earbuds. Microsoft previously had headphones in its
Surface audio-products lineup. Apple Inc.'s AirPods have 53% of the
global earbud market share, according to Counterpoint Research.
Write to Sarah E. Needleman at sarah.needleman@wsj.com and
Joanna Stern at joanna.stern@wsj.com
(END) Dow Jones Newswires
October 02, 2019 14:10 ET (18:10 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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