After 40 Years, Microsoft Wants to Be the Next Apple

The rumors were true!

Heading into Microsoft's (NAS: MSFT) super-secretive tablet-centric event, people weren't sure exactly what to expect other than, well, a tablet. The rumblings that Barnes & Noble could have played a partnered role were shot down just hours ahead of the event by B&N itself. Instead, the speculation that Microsoft was tossing its hat directly into the hardware ring with its own tablet was spot-on. Say hello to Microsoft Surface.

Microsoft Surface. Source: Microsoft.

Microsoft: the next Apple?
The most important part of yesterday's announcements is that Surface represents one of the biggest strategic shifts for Microsoft since its inception nearly 40 years ago in 1975.

Throughout its history, the software giant has focused on just that: software. Its forays into hardware have been limited in scope and mostly in smaller markets, primarily the Zune music player and Xbox 360. The entertainment and devices division that houses the Xbox business generated revenue of $1.6 billion last quarter, less than 10% of sales, swinging to an operating loss.

The Zune has since been officially killed, and beyond that, Microsoft's hardware products in its core PC market are minor accessories like keyboards and mice. Within the PC and smartphone markets, the company has always only served up the operating system, leaving the hardware to third-party OEMs.

Never before has Microsoft made such a big plunge into hardware in what it hopes will become a core market, integrating its hardware, software, and services all into one streamlined package not unlike its rival from Cupertino. Of course, this is the strategy that Apple (NAS: AAPL) has pursued since day one.

Microsoft Surface (left) vs. Apple iPad (right). Sources: Microsoft, Apple.

The open strategy helped the software giant become ubiquitous during the rise of the PC decades ago, yet the open strategy has mostly failed Google's (NAS: GOOG) attempts to gain traction in the nascent tablet arena -- a failure that Microsoft (as well as Google) has taken note of.

Fill in the blank
Microsoft left out some of the juicier details, so one can't help wondering whether the company took the wraps off the device a little prematurely and whether it's fully baked yet. It's launching two versions of the device, Windows RT with ARM Holdings-based chips and Windows 8 Pro with the requisite Intel (NAS: INTC) Inside. Here are some of the specs the company has detailed, compared with the third-generation iPad.

Sources: Microsoft, Apple.

The Windows RT tablet shown off is sporting a Tegra processor from NVIDIA (NAS: NVDA) , although Microsoft declined to specify whether it was the older dual-core Tegra 2 or the latest quad-core Tegra 3. It's presumably the latter, since we already know that NVIDIA is going to be a Windows 8 launch partner with its Tegra 3, so it wouldn't make sense to stick an old chip in the new Surface.

One important missing piece is the price, but the company says pricing should be comparable with other ARM tablets or Ultrabooks. That's going to be a key aspect as Apple maintains its pricing aggression, and a pricing advantage could give Microsoft some hope in scoring sales.

Out with the old Surface, in with the new Surface
We're no longer talking about the coffee table-sized touchscreen that the software giant has had lying around its labs for years with little to no commercial market. That offering has been rebranded as PixelSense, and the Surface name is being repurposed for Microsoft's new tablet.

Apple envy
The announcements were very Apple-esque in more ways than one. The event was shrouded in secrecy heading into the unveiling, and the presentation itself reminded some analysts of Apple's. Microsoft is also releasing an accessory very similar to Apple's Smart Cover called a Touch Cover that features a built-in tactile keyboard. One analyst even called the Surface "the sincerest form of flattery to Apple."

Microsoft Surface. Source: Microsoft.

The real question is whether Microsoft find tablet success by taking a page out of Apple's integration playbook. Let's be clear about something: Surface is no iPad-killer. But it might very well be an Android tablet killer.

I've been bullish on Windows 8 from the get-go ever since the software giant unveiled the OS late last year. Microsoft Surface will probably see some success, and the next major strategic dilemma will be whether the software giant decides to expand its integration and jump into more hardware if Surface does particularly well.

Maybe, just maybe, Apple is on to something with the whole integration approach.

Apple's success with integration has made it the biggest tech company in the world, so does that mean you should buy or sell Apple today? We've laid it all out for you in a brand new report that has the answer to that $500 billion question. Or to learn about another tech revolution, you can check out our research report detailing another technology revolution you might not even know about.

The article After 40 Years, Microsoft Wants to Be the Next Apple originally appeared on Fool.com.

Fool contributorEvan Niuowns shares of Apple, but he holds no other position in any company mentioned. Check out hisholdings and a short bio. The Motley Fool owns shares of Intel, Microsoft, Apple, and Google.Motley Fool newsletter serviceshave recommended buying shares of Apple, Microsoft, Intel, Google, and NVIDIA, writing puts on Barnes & Noble and NVIDIA, and creating bull call spread positions in Apple and Microsoft. The Motley Fool has adisclosure policy. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.