Tech Industry

Microsoft's cheapest Surface tablet won't cost $1K after all

Reports of $1,000 and $2,000 Surface tablets on a Swedish e-commerce site are much ado about nothing -- the numbers were not based on actual prices from Microsoft.

Microsoft's upcoming Surface tablet

Those of you eyeing a Microsoft Surface tablet won't have to cough up $1,000 or $2,000 for the privilege.

The rumor mill was buzzing yesterday after Swedish Website Webhallen listed prices for the four different Surface models ranging from $1,002 up to $2,150.

But now it turns on that the site's prices weren't based on anything in the real world. Responding to a query from CNET, Webhallen confirmed that it's received no information on pricing from Microsoft. The site instead claimed that it jacked up the prices on the tablet to lure in eager customers who want to pre-order the tablet.

"Our customers are very interested in pre-ordering these products, so we have set a high preliminary pricing for the lineup so that they may be able to pre-order them," Webhallen told CNET. "Just to clarify, we have not [received] any pricing from Microsoft regarding MRSP or purchasing net cost, and any people who have booked the Surface at this high price will of course have their order adjusted before any product is shipped. So we're not going to overcharge anyone for being an early adopter."

Why the site tried to attract customers by inflating the price of the tablet may sound like a mystery. But retailers do sometimes bump up the prices of upcoming products, thinking that lowering the price once the product is released will then draw in more customers.

Of course, Microsoft would be foolish to price its upcoming new tablet so out of whack with the marketplace -- the market-defining Apple iPad starts at $499, for instance. The company faces enough challenges just getting Windows 8 off the ground and fighting over market share with Apple and Android tablet makers.

With the iPad still the king of the tablets, Microsoft has to compete on features. But as Android vendors unveil more budget-friendly tablets, it also has to compete on price. The challenge is to balance the two.

Microsoft also needs to convince consumers who might normally opt for an iPad or an Android tablet that a Windows 8 tablet offers advantages not found in the other two camps.

Updated 7/30 4:15 a.m. PT with response directly from Webhallen.

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