Surface Pro 3 deep-dive review: Has Microsoft finally got it right?

The latest Windows 8 device is supposed to work as both a tablet and a laptop. After working with it for a week, does our reviewer agree?

There's a saying about Microsoft that I've heard for a long time: It takes three tries for the company to get something right. For example, it wasn't until Windows reached version 3.0 that the operating system really took off, and it was only when Word 3.0 hit that the word processor became a market standard.

But is this also true about the Surface Pro 3, the third iteration of Microsoft's tablet line? Microsoft touts the Surface Pro 3 as a device that, when equipped with an added Surface Pro Type Cover, does double-duty as a productivity tablet and a true laptop.

So how is the Surface Pro 3 as a laptop -- or a tablet? To test that out, I carried it around and used it, forgoing the MacBook Air that I typically use when I work away from my desk. It was an ideal test case, because Microsoft has clearly aimed the Surface Pro 3 at the MacBook Air. In fact, on Microsoft's Surface website, there's an entire section devoted to comparing the specs of the Surface Pro 3 to the Air.

Microsoft Surface Pro 3
I had previously tried to use its predecessor, the Surface Pro 2, as a primary laptop, and found it impossible to do. But the Surface Pro 3 was generally up to the task, although with some drawbacks.

A look at the specs
Before I go into details about my experience with the Surface Pro 3, let's take a look at its basic specs.

In this area, it certainly seems as if Microsoft got it right this time. The Surface Pro 3 has a 12-in. display, 40% larger than the Surface Pro 2's 10.6-in. screen. And it's quite spectacular, with 2160 x 1440 resolution and a 3:2 aspect ratio -- more like a traditional computer's than the Surface Pro 2's aspect ratio of 16:9.

Despite the larger screen, the Surface Pro 3 is thinner and lighter than the Surface Pro 2 --- it's 0.36 in. deep and weighs 1.76 lb., compared to the Surface Pro 2's depth of 0.53 in. and weight of 2 lb. That may not sound like much of a difference, but in use, it really matters (as I explain later in this review). Depending on the model you choose, the device is powered by an Intel i3, i5 or i7 processor. Storage ranges from 64GB up to 512GB, and RAM from 4GB to 8GB.

There's the usual complement of ports, including a USB 3.0 port, microSD card reader and mini DisplayPort. There are front- and back-facing 5-megapixel cameras capable of 1080p video. And it comes with an interesting stylus; more about that later.

The device connects via Wi-Fi and Bluetooth; I found that the Surface Pro 3's Wi-Fi connection is a very good one. Not only did it always connect well in public places such coffee shops, it even did well in what is often a dead zone in my house, an upstairs room fronting the street in which my home network connection is always iffy. In the worst area in my home, where my iPhone gets no Wi-Fi and my MacBook Air gets it intermittently, the Surface always maintained its connection, albeit a slow one.

One especially useful feature is the kickstand, which comes standard as part of the Surface Pro 3. It has been considerably improved -- you are no longer limited to a few pre-set angles; instead, you can set it to any angle between zero and 150 degrees, just as you can position the screen of a laptop.

And how much will all this cost? Even though it's a considerably better device than the Surface Pro 2, Microsoft has dropped the price of the Surface Pro 3 by $100, so it starts at $799. That gets you a device with an i3 processor, 4GB of RAM and 64GB of storage. If you want to go whole hog, $1,949 buys you a Surface Pro 3 with an i7 processor, 8GB of RAM and 512GB of storage.

Accessories include a $200 docking station with a keyboard port, a DisplayPort, an audio input/output jack, an Ethernet port, one USB 3.0 port and three USB 2.0 ports. There's also a $40 Ethernet adapter available. And, of course, there's the Surface Pro Type Cover, which does double-duty as a cover and keyboard, and which costs an additional $130. (More on that later.)
An excellent display

One of the biggest problems I had with the previous-gen Surface Pro 2 as a laptop was its screen. At 10.6 in., there simply wasn't enough screen real estate for me to get real work done on spreadsheets or Word documents. And while its 16:9 aspect ratio was fine for watching movies and videos, it required far too much side-to-side scrolling to be suitable for work.

The Surface Pro 3 improves on that dramatically. I found the 12-in. screen to be large enough to get whatever work I needed done, and the 3:2 aspect ratio was more comfortable than the 16:9 ratio of the Surface Pro 2. In fact, I discovered that 12 in. is quite roomy enough for real work. I had expected that it would feel cramped compared to my MacBook Air's 13.3-in. screen. But that wasn't the case at all -- because of its 2160 x 1440 resolution, I was able to fit quite a bit on it.

That high resolution comes at a price, though. Text and images were at times too small to be read comfortably. Zoom capabilities solved the problem, but not always. That's because, although Windows 8 Store apps (previously called Metro apps) can be zoomed in and out, not all desktop apps work with zoom. That was problematic at times.

I found that the SugarSync desktop client, for example, was barely usable because of how small the type was. True, I could always lower the desktop resolution to make it more readable, but when I did that, less space was available on screen for other apps. In addition, the SugarSync Windows 8 Store app lacked some of the most basic capabilities of the desktop app, so it wasn't a good alternative.

In other words, using desktop apps can be a crapshoot with the 12-in. screen.

The new Type Cover
The new Surface Pro Type Cover, which doubles as a cover and a keyboard, is a big improvement over the previous version.

To begin with, I always had an issue with the touchpad on the Surface Pro 2's Type Cover: It was small and not recessed, difficult to find and equally difficult to use. At times I found myself accidentally moving the cursor because it was hard to know where the touchpad stopped and the bottom of the keyboard began. And when I did find the touchpad, it was too unresponsive to be particularly useful. I resorted to a Bluetooth mouse.

Not so with the new keyboard. The touchpad is recessed, so it's easy to find; I never had to fumble for it. Because the touchpad is larger (and felt more responsive), I could more easily control the cursor. It's a small change, but a very big improvement, so much so that I no longer had to bring a Bluetooth mouse with me to get work done.

In addition, the Type Cover now has a magnetic hinge that raises the keyboard to a slight angle. This is well-suited for working with the Surface Pro 3 on your lap, but I also found it useful on a desk or table top, because I favor slightly angled keyboards. (I'm a fast touch typist and I like to pound a bit on the keyboard; with the angled keyboard, I'm no longer drumming directly on the table.) It's another example of how a small engineering change has made a big difference in the Surface Pro 3's usability.

Is it better than the 13.3-in. MacBook Air keyboard? Not for me. Having some separation between keys, as you have on the MacBook Air but not on the Surface Pro 3, allows me to type more quickly and make fewer mistakes. And because it's a "real" keyboard, the Air's keys have more give and feedback than do the Surface Pro's.
The Surface Pro 3 as a tablet

The Surface Pro 3 may do double-duty as a laptop, but its basic design is as a tablet. And there, despite some very nice hardware, it falls short.

As mentioned before, the 12-in. screen is nothing short of spectacular, with vivid, crisp images and no noticeable lag or other issues with motion. No matter what movie or TV show I played on it, I found myself wanting to watch more. The speakers, as with the previous Surface Pro, are excellent, with Dolby stereo audio so realistic that it feels as if the sound is coming from the room itself, not from the speakers.

Microsoft says the speakers are 45% more powerful than the previous Surface Pro, but I never thought the previous speakers had a problem with volume, so this claim may or may not be meaningful. As a media-consumption tablet, it's stellar -- much superior to my iPad or Google Nexus 7.

That large screen also makes a difference when browsing the Web, offering a full experience, rather than the mobile one you get on smaller tablets. For example, when you're using mapping apps, it provides far more detail and context than do smaller-sized tablets.

And the large screen also makes the Surface Pro 3 useful as a productivity tablet. For example, when I was using Microsoft Office, not only could I see more of any document onscreen, but I could touch type on the virtual keyboard because of the larger keys, something not possible on smaller tablets.

But I found the large screen to also be somewhat of a mixed blessing. Because of its size, it's bulky to carry compared to a 10-in. iPad, and its 1.76 lb. is still significantly heavier than the 1-lb. iPad Air.

However, the real shortcoming with the Surface Pro 3 as a tablet is its dearth of apps compared to the iOS and Android platforms -- as I'll discuss in a moment.
Styling with the stylus

The Surface Pro comes with something that most competing tablets don't have -- a stylus. The Surface Pro 3 has gotten a stylus makeover, to good effect. The old stylus (manufactured by Wacom) was black plastic and felt somewhat cheap, and never felt quite right in my hand. The new one (now built by N-Trig) is made of polished aluminum, and not only looks better, but is heavier and has a far more pleasing and substantial feel to it.

It's got two buttons, so offers more flexibility, depending on the app you're using it with -- for example, in OneNote you can hold down one of the buttons and the pen acts as an eraser. The two buttons also do double-duty as mouse buttons. All in all, when I used it, I felt as if I really were using a pen, and a nice one at that, rather than just a tube made of plastic.

The stylus no longer attaches to the place where the power cord goes, as it had in the Surface Pro 2. That's both good and bad. It's good because in the past if you wanted to charge the Surface Pro, you had to first take out the stylus. But it's bad because there's now no place on the device itself to attach the stylus. If you buy a Type Cover, there's a small loop on the side for tucking in the stylus, but even then, I worry whether the holder will fray and tear over the long term. (If you lose it, a new stylus will cost you $50.)

Before trying out the Surface Pro 3's stylus, I was never much of a stylus fan. But after spending time with it, I'm a believer, particularly for note taking. The combination of OneNote (which is included) plus the stylus is a potent duo. Not only can you hand-write notes and draw with it, but the Surface Pro also has handwriting recognition. So instead of using the virtual keyboard, you can write by hand using the stylus, and the tablet translates that into text. My handwriting is exceedingly bad, but when I slowed down and wrote carefully, it rarely made a mistake. Even when I wrote quickly and sloppily, it did better than I expected, making a mistake only about every fourth word or so.

I even wrote part of this review using the stylus in Word, although it's not an experience I would care to do again, because it requires slow and careful handwriting. Still, for jotting down notes, it's a winner.

For drawing, it's good as well. It's pressure sensitive -- press the pen on the screen lightly and it draws a light line; press it harder as you draw and the line thickens. Microsoft claims that the stylus recognizes 256 different levels of pressure. Being no artist, I can't vouch for whether it's really that sensitive, but when used with an art program such as ArtRage 4, I found it quite responsive. There is also little or no lag between pressing and moving the pen and a line appearing. It feels as natural as using a real pen.

The upshot? The pen is a true productivity tool, and not a toy or an afterthought. Professionals on the go who want a tablet with pen input would do well to consider the Surface Pro 3.
The app gap

So what's not to like about the Surface Pro 3? In a word, apps -- or more precisely, the lack of them.

The Windows Store ecosystem doesn't come close to either iOS or Android when it comes to app choice. For example, when I did a quick search, some of the popular apps that were missing included eTrade, the Chase and Citibank banking apps, Google Maps, LinkedIn, Spotify, Pinterest, Yelp, Sonos and others.

At a Glance
Surface Pro 3
Microsoft
Starting price: $799
Pros: Excellent 12-in. screen, very good keyboard cover, useful stylus and handwriting recognition, lightweight
Cons: Expensive, Windows 8 lacks many apps, keyboard cover costs $130 extra

And even when there is a desktop app and a Windows Store app for the same application, the Windows Store app typically lacks many of the important features of the desktop one. For example, the Windows Store note-taking Evernote app, called Evernote Touch, doesn't include all of the features that the desktop version does, including good browsing and searching capabilities. In fact, even Evernote itself suggests that Evernote Touch users also install the Evernote desktop app to get "the full-featured Evernote Desktop."

In short, the hardware is willing, but the apps are weak.

The bottom line
Microsoft touts the Surface Pro 3 as a tablet that does double-duty as a laptop and, if you buy the Surface Pro Touch Cover, what the company says is generally true. Still, the cover still isn't as good as a full-blown laptop keyboard. At 12 in., the Surface Pro 3 has enough screen real estate so that it's a real laptop, not a tablet pretending to be one. At 1.75 pounds, it's ultraportable, although a bit on the heavy side for a tablet.

As a tablet, there's still a shortage of apps, so if it's apps you're after, you won't be after the Surface Pro 3. But as a productivity tablet it shines because of its stylus and large screen.

What you think about the Surface Pro 3's price will depend on how you plan to use the machine. If you look at it as a traditional tablet, you'll be disappointed. At a starting price of $799, this is a very expensive tablet, especially if you compare it to the iPad Air's starting price of $499.

However, if you think of the Surface Pro as a laptop plus tablet, things look better. You'll have to buy a Surface Pro Type Cover for $130, putting the total starting price at $930. That's not a bad price for a premium laptop that doubles as a tablet -- in fact, it's just about the same price as the $899 starting price for the 11-in. MacBook Air, yet gives you more display real estate, a touch screen and a pen. On the other hand, the MacBook Air's keyboard is superior to the one on the SurfacePro Type Cover.

So will this be the tablet-laptop combo that convinces you to use Windows 8 if you're not already committed to it? No. But this machine shows that a tablet-laptop combo is not as much of a Rube Goldberg mashup as you might have imagined. It even makes sense.

With each iteration, the Surface line improves. Microsoft still hasn't quite nailed it yet. But it's getting close. If it closes the app gap, the Surface Pro 3 could be a big winner.

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Surface has lost $1.2B, it was Microsoft's money making machine

"I expect premium price points," said Patrick Moorhead, principal analyst with Moor Insights & Strategy, in an interview last week.

He explained why by citing rivals' business models. "Both Google and Amazon have models for their tablets where they make it up on the back end," Moorhead said, referring to the advertising and product sales that the two rely on to offset their lower-priced tablets. "But I don't feel like Microsoft has achieved scale in their tablet content to offset [lower prices]."

Higher prices means lower sales volume. And that's a problem. "You have to have scale to buy cheaper components. Microsoft doesn't have the scale to be profitable or to hit interesting price points," Moorhead argued.

In other words, because Microsoft will be forced to stick with premium prices for the Surface, it's unlikely to sell in enough volume to be able to strike bargains with component suppliers. If it was able to make those deals, it could either use the lower costs to turn a profit in the short-term, or more likely, immediately reduce prices, recognizing that would delay profits but expecting the losses to turn into even larger, and more sustainable, gains.

Others also expected the new Surface tablets to retain their high prices. Independent analyst Sameer Singh, for example, pegged the likely price of a "Surface Mini," a 7- or 8-in. tablet, at between $249 and $299. "I don't think Microsoft can afford to compete with low-end Android and 'white box' manufacturers on price," Singh said recently.

Singh's price range was closer to the established first-generation iPad Mini -- which lists for $299 -- than to the current crop of 7-in. tablets from the likes of Amazon and Samsung, priced at less than $200.

Rumored prices of a new slate of Surface Pro tablets -- the models that run legacy Windows applications -- also tilt toward the high end. A report Saturday by Windows Phone Central claimed that the next-generation Surface Pros will start at $799 and run up to $1,949.

Those prices are minus the keyboard that Microsoft virtually mandates in its marketing. A Surface keyboard currently runs between $80 and $140.

Although the $799 base price is $100 less than the lowest-priced 64GB Surface Pro 2 sold today, the combined tablet + keyboard package equals an out-of-pocket expanse around $900, still stratospheric for tablets, and in the realm of premium notebooks and the 2-in-1 hybrids Microsoft aggressively trumpets.

Minus a price-reduction strategy, Microsoft faces an uphill battle against the also-premium-priced iPad and a bewildering array of low-cost Android tablets. The smaller losses in the last two quarters are encouraging signs. But there are some other signals that the Surface is gaining ground, and doing it organically.

"Surface Pro is making some headway in corporate environments," contended Ross Rubin of Reticle Research. "One of the big draws for Surface versus competitors is legacy Windows compatibility, and its pricing is more geared toward corporate customers."

Fidel Deforte, the infrastructure and communications technology manager for the city of Cape Coral, Fla., agreed. In an email last week, Deforte outlined how he has begun replacing some senior managers' hardware -- typically a combination of an iPad and a Windows notebook -- with the Surface Pro. And saving money as he did.

"I replaced [a manager's] HP laptop and iPad (total value $2,600) with the Surface Pro 2 ($1,300) and she not only loves this, but sees that it is more flexible and efficient," Deforte wrote.

All that Nadella needs is millions more stories like Deforte's.

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Microsoft's money pit: Surface has lost $1.2B

CEO Nadella will unveil new tablets Tuesday, but can he stop the bleeding?

Microsoft has lost more than $1.2 billion so far on its Surface tablet business, an expensive experiment that makes tomorrow's revelations of new hardware an important milestone for the "devices" side of its corporate-refashioning strategy.

On Tuesday, CEO Satya Nadella is expected to step on a New York stage and unveil one or more new Surface tablets, and outline his direction for the in-house hardware project birthed by his predecessor, Steve Ballmer.

While analysts and observers have split on Surface's future -- some see Tuesday as a last-chance for Microsoft to tweak its tablet strategy, others believe the company will press forward regardless of the reception pundits give the new devices -- it's a no-brainer that eyes will be on Nadella, who will have to explain how he will push, pull and drag the Surface out of its money-losing ways.

For although Microsoft has been parsimonious in the details it declares of the Surface's financial performance, the business has clearly been a money pit. In the last two quarters -- the only ones in which Microsoft has explicitly called out revenue and cost of revenue -- the tablet line lost $84 million.

But that was small potatoes compared to the September 2013 quarter.

According to its most recent 10-Q filed with the U.S. Securities and Exchange Commission (SEC) -- and some simple arithmetic -- Microsoft generated $413 million of Surface revenue that quarter, but spent $629 million to produce the revenue, posting a loss of $216 million.

Combine that $216 million (Q3 2013) with the $84 million (Q4 2013 and Q1 2014), and the total nine-month loss for Surface comes out at an even $300 million, as Microsoft admitted in the 10-Q.

The bleeding does not stop there, however.

Microsoft was forced to take a $900 million write-down in mid-2013 to account for the glut of Surface RT tablets it couldn't sell. That adjustment was above and beyond whatever cost of revenue Microsoft incurred to build and sell the Surface tablets it did unload between the October 2012 (Surface RT) and February 2013 (Surface Pro) debuts, and June 30, 2013.

The company never divulged the cost of revenue for those three quarters -- Q4 2012 and Q1 and Q2 2013 -- saying only that revenue had been $853 million. But it would be foolish to assume that the cost of revenue was less than the revenue, what with Microsoft's inability to turn a profit in later quarters.

So even without factoring in the three-quarter cost of revenue, Microsoft has lost $1.2 billion on Surface: The $900 million write-down + the $300 million loss from Q3 2013 on. How much more than $1.2 billion? Only Microsoft knows.

The loss, although not an existential threat -- Microsoft recorded $5.7 billion in net income in the March quarter and has $88 billion in its cash and short-term investment horde -- puts Tuesday's unveiling in a harsh spotlight. Can Nadella turn tablets around, from money losers to money makers?

Microsoft's tablet strategy has cost the company $300 million in the last nine months, more than $1.2 billion since its debut. Can the new CEO turn that around? (Data: Microsoft, SEC filings.)

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Malicious Downloader’s calls out Microsoft

Anti-malware vendors advise about downloaders used to infect PCs

Microsoft is placing makers of downloader software on observe when it sees that their softwares are getting used to infect PCs, and it is effective anti-virus vendors that maybe these downloader agenda ought to be tagged as malware.

In its latest Security Intelligence Report the corporation comments that the use of previously benign downloaders has ever more become a means to infect computers with malware, mainly click-fraud programs and ransomware in which assailant extort cash from wounded in return for return their equipment to a useful state.

As part of its manufacturing teamwork, Microsoft shares the data it gathers from its clients about infections with related parties. In this case it tells the downloader makers in hopes they can restrict use of their products to legitimate purposes.

It tells anti-malware vendors so they are aware that certain downloaders represent a threat and should be removed from computers protected by their products, says Holly Stewart, a senior program manager in Microsoft’s Malware defense Center.

A downloader called Rotbrow was the one mainly often used to help malicious actions throughout the last partially of 2013, most usually by downloading a click-fraud app called Sefnit. Before that Rotbrow didn’t record at all as a tool use by attackers, Stewart says.

characteristically the downloaders are bundled with useful freeware such as software to unzip archive. The downloaders might be used legitimately to download updates to the unzip programs, or to download malware, Stewart says.

The dominant types of malware Microsoft observed being downloaded in this way during the last half of 2013 were BitCoin miners and click-fraud programs.

Bitcoin miners run in the background of infected computers to confirm and process Bitcoin transactions in exchange for earning Bitcoins. The attacker reaps the Bitcoins earned by the infected computers. Click fraud forces the infected computer’s browser to automatically click on advertisements that earn cash for each click logged. In both cases indication of the infections can decrease performance of the engine involved.

Microsoft also experimental the proliferation of ransomware, with one called Reveton important the pack and enjoying a 45% raise in use during the last half of 2013, Stewart says. The need to disinfect Microsoft computers of ransomware tripled during the same time period, according to the Security Intelligence Report.

Microsoft procedures prevalence of malware by including the number of computers cleaned per 1,000 computers that are execute Microsoft’s Malicious Software Removal Tool. For ransomware in general, that count rose from 5.6 to 17.8 between the third and fourth quarters of last year, Stewart says.

Ransomware attacker’s goal picky regions with particular ransomware platforms, she says. For example, the one called Crilock is aimed mostly at computers in the U.S. and U.K. while Reveton aims at the likes of Spain, Belgium, Portugal, Hungary and Austria.

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