Emerging Technology

Microsoft reveals large Surface losses as it loses the rights to the SkyDrive brand

Andrew Sadauskas /

Microsoft has revealed millions of dollars of losses as a result of its Surface tablet device on the same day a UK court banned the tech giant from using the SkyDrive brand in relation to its cloud computing products.

According to GeekWire, Microsoft revealed it has spent $US898 million advertising the Surface and Windows 8, on top of its recent $US900 million writedown of unsold tablets.

In contrast, the company has only generated $US853 million in revenues off the troubled product line since its release, meaning a maximum of just 1.7 million unit sales (assuming all units were sold the low-end release price). In contrast, Apple sells around 14.6 million iPads per quarter, while Samsung sells around 8.8 million.

As SmartCompany recently reported, Microsoft is currently sitting on an inventory of unsold tablets estimated to number around 6 million units.

Meanwhile, a UK court has found the SkyDrive name infringes on a trademark owned by UK pay television service BSkyB, with The Verge reporting the tech giant has since agreed to replace the trademark worldwide.

“We’re glad to have resolution of this naming dispute, and will continue to deliver the great service our hundreds of millions of customers expect, providing the best way to always have your files with you,” Microsoft says in a statement.

The news comes after Microsoft suddenly decided to rename the user interface to its Windows 8 operating system, which had previously been known as Metro, in August last year. Its initial statement on the Metro name change denied the decision was related to an intellectual property dispute.

However, soon after the release of the statement, an internal memo from the tech giant leaked, which reportedly showed senior management ordering staff to refer to the new Windows 8 and Windows RT interface as the “Windows 8 style UI”. The order came as a result of unspecified “discussions with an important European partner” that led it to “discontinue the use” of the Metro brand.

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Andrew Sadauskas

Andrew Sadauskas is a former journalist at SmartCompany and a former editor of TechCompany.

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