Microsoft’s newfound success as a maker of high-end PCs is starting to create some awkward situations with other vendors.
That much became clear this week, when Lenovo President and COO Gianfranco Lanci said he refused an arrangement to resell Surface devices to enterprise customers, The Register reports. Microsoft “asked me more than one year ago, and I said no, I don’t see any reason why I should sell a product from, within brackets, competition,” Lanci said.
While it may defy belief that PC makers are selling Microsoft’s hardware instead of their own, some vendors such as HP and Dell have broader enterprise service businesses to protect. They’ve begrudgingly accepted Microsoft’s offer to resell Surfaces when customers ask for them, despite making no money from the sales. “These are customers we have been working with for many, many years and we don’t simply want to cede those relationships to a competitor, so we said ‘OK, we’ll participate in that’,” HP CEO Dion Weisler said, according to The Register.
The story behind the story: In the past, vendors like Lenovo and Dell politely dismissed Microsoft’s Surface devices as uncompetitive, and in some cases even praised them as helping strengthen the PC market. While they continue to put on brave faces publicly, reports are emerging of behind-the-scenes hostility as the Surface Pro line gains sales traction and the Surface Book takes direct aim at traditional laptops.
Microsoft’s resale arrangement with HP and Dell shows is just one example of how powerless PC makers are as Microsoft swoops into the hardware business. But those vendors are clearly seeing the bigger picture as well.
After Microsoft revealed the Surface Book, one OEM employee told Business Insider that Microsoft was like a “sleeping lion” that no vendors dare disturb. Meanwhile, sources within Asus reportedly said they felt blindsided by the new hardware, which they may not have even known about ahead of time.
Although Microsoft claims that its hardware is complementary to that of other PC makers, its partners can’t be happy about the prospect of Microsoft dominating the high-end market, leaving them to fight over the scraps. There’s little they can do, however, with Windows remaining the most viable desktop operating system to put on their machines.
At the same time, it’s hard to feel too much sympathy for these PC makers, who’ve had three years to come up with compelling high-end products. While Microsoft has steadily iterated the Surface into a killer product line, its competitors—and yes, they are competitors now—continue to put out the same bland ideas that they were pursuing in 2012, or rely on intrusive bloatware to prop up their profit margins. A wakeup call—even a blindsiding one—might not be such a bad thing.