THE ARJUN SANTOSH BLOG: February 2013

Work too hard, strive too hard, appear to be too ambitious, try to stand out from the crowd. It's a lot easier and much more comfortable to reel it in to ensure you fit in.

Pleasing the (average-performing) crowd is something remarkably productive people don't worry about. (They may think about it, but then they keep pushing on.)

They hear the criticism, they take the potshots, they endure the laughter or derision or even hostility--and they keep on measuring themselves and their efforts by their own standards.

And, in the process, they achieve what they want to achieve.

They see fear the same way other people view lunch.

One of my clients is an outstanding--and outstandingly successful--comic. Audiences love him. He's crazy good.

Yet he still has panic attacks before he walks onstage. He knows he'll melt down, sweat through his shirt, feel sick to his stomach, and all the rest. It's just the way he is.

So, just before he goes onstage, he takes a quick shower, puts on fresh clothes, drinks a bottle of water, jumps up and down and does a little shadowboxing, and out he goes.

He's still scared. He knows he'll always be scared. He accepts it as part of the process. Pre-show fear is like lunch: It's going to happen.

Anyone hoping to achieve great things gets nervous. Anyone trying to achieve great things gets scared.

Productive people aren't braver than others; they just find the strength to keep moving forward. They realize fear is paralyzing while action creates confidence and self-assurance.

They can still do their best on their worst day.

Norman Mailer said, "Being a real writer means being able to do the work on a bad day."

Remarkably successful people don't make excuses. They forge ahead, because they know establishing great habits takes considerable time and effort. They know how easy it is to instantly create a bad habit by giving in--even just this one time.

They see creativity as the result of effort, not inspiration.

Most people wait for an idea. Most people think creativity happens. They expect a divine muse will someday show them a new way, a new approach, a new concept.

And they wait and wait and wait.

Occasionally, great ideas do just come to people. Mostly, though, creativity is the result of effort: toiling, striving, refining, testing, experimenting... The work itself results in inspiration.

Remarkably productive people don't wait for ideas. They don't wait for inspiration. They know that big ideas most often come from people who do, not people who dream.

They see help as essential, not weakness.

Pretend you travel to an unfamiliar country, you know only a few words of the language, and you're lost and a little scared.

Would you ask for help? Of course. No one knows everything. No one is great at everything.

Productive people soldier on and hope effort will overcome a lack of knowledge or skill. And it does, but only to a point.

Remarkably productive people also ask for help. They know asking for help is a sign of strength--and the key to achieving more.

They start...

At times, you will lack motivation and self-discipline. At times, you'll be easily distracted. At times, you'll fear failure or success.

Procrastination is a part of what makes people human; it's not possible to completely overcome any of those shortcomings.

Wanting to put off a difficult task is normal. Avoiding a challenge is normal.

But think about a time you put off a task, finally got started, and then, once into it, thought, "I don't know why I kept putting this off--it's going really well. And it didn't turn out to be nearly as hard as I imagined."

It never is.

Highly productive people try not to think about the pain they'll feel in the beginning; they focus on how good they will feel once they're engaged and involved.

And they get started. And then they don't stop.

...And they finish.

Unless there's a really, really good reason not to finish--which, of course, there almost never is

GOOGLE LAUNCHES 2 HOUR RECRUITING VIDEO STARRING OWEN WILSON AND VINCE VAUGHN

Google is launching a 2-hour recruiting video starring Owen Wilson and Vince Vaughn. It will soon be in a movie theater near you. Seriously. Check out the trailer below.

Okay, so its not REALLY a recruiting video, per se. It is actually a regular movie that takes place on the campuses of Google. It showcases what its like to work there and gives you a real feel for the great and wonderful things that take place there. Oh, wait a minute! Isn’t that a recruiting video?

Curiously enough, Google does not have a financial stake in the movie. (The LA Times said so.) But it did give the film crew access to their Googleplex campus and consulted with them on creating a Google-like set.

Fyi, the movie debuts on June 7th. I would really, really, really want to know how this affects their recruiting numbers. Will they get a surge of new applicants? How many of those candidates will they hire? And if so, how long before there is a recruiting video featuring Facebook? And not to be outdone, Microsoft produces one as well. Could this be a new trend in recruiting?!!!!

Probably not. But its fun to speculate. What do you think? Leave me a comment below?

Microsoft Could Make Billions From Office for iPad

By keeping its Office productivity suite off the iPad, Microsoft has given its new Surface tablet a key competitive advantage in a market to which it is a very late entrant. That might seem like a strategically sound decision — creating a perceived deficit on a rival’s tablet by limiting distribution of a very popular piece of software to your own. But it could prove to be a bad move fiscally.

To wit, a new report from Morgan Stanley analyst Adam Holt, who argues that Microsoft is leaving money on the table by not releasing Office for iOS. A lot of money.

Holt figures that if Microsoft were to release Office for iOS, pricing it at $60, it could potentially sell it to roughly 30 percent of iPad users. Extend that to an installed base of 200 million iPads in 2014, and Holt concludes that Microsoft would generate about $2.5 billion in revenue per year on Office for iPad — less Apple’s App Store commission.

Now, Holt’s math here is back-of-the-napkin at best, but even so, it makes a valid point. By not releasing Office for iPad, the company is surely leaving a bunch of milk in one of its most important cash cows.

But it’s not like Microsoft doesn’t know that. And it’s more likely than not that the company is very carefully weighing tradeoffs here, and trying to determine if keeping Office off iOS is a sufficient incentive for enterprise to use Surface and other Windows tablets. Indeed, asked about Office for iPad at the Goldman Sachs conference earlier this week, CFO Peter Klein seemed to suggest that Microsoft is keeping the door open for it.

“We have a history of cross-platform delivery broadly in productivity, whether it’s Office on the Mac, or email, communications, note-taking,” Klein said. “And with our Web applications you can access Office documents, do some light editing on any device and on any browser. So there’s a lot of things that we’re already doing to meet that need. And we’ll continue to think about other things going forward.”

Sunday 17 February 2013

Roses are Red, My Love

Saturday 16 February 2013

What's Luck Got to Do With It?

In the story of David and Goliath, David won by changing the rules of the game. Rather than meeting this giant in a head-to-head battle with spear, shield and sword, David used a slingshot. And this is a good allegory for the kind of strategy you should pursue in business competition. According to Michael Mauboussin, “When competing one-on-one, follow two simple rules: If you are the favorite, simplify the game. If you are the underdog, make it more complicated.”

The reason this is the most effective strategy is that luck plays at least some role in virtually every business conflict. If you're the underdog, making the game more complicated will give luck more of a chance to triumph, so you may end up the winner (this one time, anyway) even though the odds are against you. If you’re the superior adversary, on the other hand (more scale, more resources, better research, whatever), then you should simplify the game to make sure that your superior skill is more likely to determine the outcome. David was clearly the underdog, ergo the new and unusual weaponry.

Michael Mauboussin’s marvelous new book, The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing (2012, Harvard Business Review Press) takes a straightforward look at discerning how much of an event’s outcome should be attributed to skill or ability, as compared to how much should be attributed to luck or randomness. Most things in life depend on both luck and skill, but in varying amounts. Some things are more subject to randomness than others. And some things involve little skill at all.

It's easy to tell whether an event is entirely based on luck: Just ask whether you can intentionally lose. You can’t intentionally lose a coin toss or a game of roulette (because each is 100% luck), but you can intentionally throw a football or basketball game (because at least some skill is involved). Similarly, you can intentionally invest in an unwise manner, you can intentionally lose business to a competitor, and you can intentionally manage your company in an unprofitable way. Mauboussin's point is that even though the outcomes of each of these endeavors still involve a good deal of luck, skill does play a role.

The Success Equation is the subject of this week's Friday Book Share. Mauboussin is the eclectically interesting chief investment strategist at Legg Mason Capital Management. His books are fascinating far beyond their implications for finance. I’m a big fan, and this is one of his best.

To help us understand how important luck and skill are in any situation Mauboussin starts with the law of large numbers. Toss a coin in the air 3 times in a row and it's not impossible for you to get 100% heads. The odds of that happening are in fact one out of eight. But the likelihood of getting 100% heads on 20 straight coin tosses sinks to less than one in a million (0.5 to the 20th power). It's much more likely that only about 50% of your tosses will be heads. That's the law of large numbers at work. The larger your sample size, the more likely your results will be about average, and in a coin toss the average is 50%.

Mauboussin takes this and other commonly known properties of chance and randomness and teases out of them some very intriguing and compelling conclusions about how much luck rules our existence in a wide variety of endeavors. In sports, for instance, the outcome of a single basketball game tends to be more skill-driven than a football game, primarily because basketball teams each generate a larger "sample size" of potential scoring events during a single game. And football more than hockey, etc. He backs these assertions up with convincing quantitative evidence.

Mauboussin argues that one of the fastest ways to improve your skill is to pay attention to good, reliable feedback. In sports the feedback is immediate and obvious, but in business and many other fields the feedback isn’t always so reliable. Business executives often don't take the time to gather feedback on the wisdom of a prior decision, in order to study whether it could have been improved, so that the next decision will be better.

In fact, business people seem to think they can succeed solely by studying success, rather than by analyzing failure, as well. And this is where Mauboussin makes an important point about books by various business gurus: Because business involves a great deal more randomness and luck than sporting events do, you need to be careful to use as large a sample size as possible when you make inferences, and not to leave failures out of your sample. He cites Jim Collins’ iconic book Good to Great as an example. If you recall this book, Collins reviewed thousands of companies to identify eleven whose performance went from good to great, and then tried to analyze the strategies that went into their successes. But as Mauboussin says, “The trouble is that the performance of a company always depends on both skill and luck, which means that a given strategy will succeed only part of the time. So attributing success to any strategy may be wrong simply because you're sampling only the winners. The more important question is: How many of the companies that tried that strategy actually succeeded?”

Why does this matter to businesses? Because risky strategies may be more likely to succeed, but they are also more likely to fail. “Going for broke” inevitably will succeed sometimes for a business, and when it does it will likely do so in a spectacular way. But if those companies that went for broke and didn’t make it are removed from the sample (either because they’re no longer around or because their lack of success meant they weren’t included in the study), then what are we really saying?

(And by the way, Martha Rogers and I are always careful to write about business failures as well as successes, to the extent we can get access to details about them. In one of our first books, Enterprise One to One, we devote an entire chapter to a case study on MCI's failed customer loyalty initiative, for example, while our latest book Extreme Trust critiques failures at AOL, Nestle, Netflix, and a few entire business categories, as well.)

I posted a comment not long ago about Geoffrey Moore’s extremely thoughtful and well-argued recommendation to HP that bears directly on this topic. Moore recommends that HP should concentrate on just one innovation per half decade, because that’s all a CEO can truly focus the company on, and if the whole company isn’t focused on it then its go-to-market strategy will fail. But I'm not so sure about Moore's idea, and Mauboussin would almost certainly be on my side in this. Moore's logic is persuasive and, as usual, his knowledge of the venture and tech innovation business shines, but I think success at innovation inherently involves a great deal of luck and randomness. No matter how much skill you have (and no matter how much attention your CEO focuses on the go-to-market strategy), you're still going to need a large sample size before you can be confident that your superior skill will shine through. I don't think one mega-effort per half decade will do it. Fifty might, but one is just a crapshoot (IMHO).

Yet another useful lesson from Mauboussin's enthralling book is what he calls “the paradox of skill.” He says that as any field attracts more and more talent, the general skill level will rise, and as this happens the statistical variance of results will decline. As people get better and better, in other words, the differences among them shrink. Mathematically, this gives us the paradox of skill: As skill levels improve generally, luck plays a greater role in determining outcomes.

To illustrate this, he asks why Ted Williams was the very last baseball player to achieve a batting average greater than .400 for the whole season (in 1941). The answer, he suggests (and he's not the only one to suggest it), is that “the variance of batting averages has shrunk over time…as the skill of the hitters has improved…. This decline in variance explains why there are no more .400 hitters. Since everybody gets better, no one wins quite as dramatically. In his day, Williams was an elite hitter and the variance was large enough that he could achieve such an exalted average. Today, the variance has shrunk to the point that elite hitters have only a tiny probability of matching his average.”

To prove his point he includes a graph showing just the standard deviation and coefficient of variation for batting averages over the last 140 years:

(Note that this graph doesn’t say that batting averages have been going down, but that the differences between themhave been going down.)

The same exact logic applies to business and investing. As skills increase across the board (because of the competition for talent, better education, training, and so forth), the role of luck in determining outcomes also increases. Over the last several decades, for instance, “investing went from being dominated by individuals to being dominated by institutions. As the population of skilled investors increased, the variation in skill narrowed, and luck became more important.”

And in business, Mauboussin suggests: “Recent research shows that while some companies do sustain superior economic performance, the rate of reversion to the mean today appears to be accelerating". [Translation: The role of luck is increasing.]

So as randomness plays an ever greater role in business success, what should the well-managed business do? He suggests several things:

Find and use more immediate feedback.
Focus more on good processes, and less on specific outcomes.
Balance your company’s emphasis on exploration of new opportunities with exploitation of current ones (when the rate of change in your category increases, more attention to exploration is called for).
Use checklists to ensure that your skills and advantages aren’t unnecessarily undermined by random mistakes.

Numbers Count, But Feelings Come First

Long ago, one of my statistics professors in college cautioned me that statisticians tend to obsess about creating the highest R-squared. Inflating one’s R-squared might be just the ticket for getting your results published in an academic journal, but the resulting model, my professor told us, is not necessarily the most useful.

The most useful model is one that helps people make good decisions and take action. The more complicated you make your model in search of superior R-squared—lots of variables, logarithmic transformations, and so on—the harder that model is to understand intuitively and the less often people will have the confidence to use it and learn from it. Statisticians' hearts may start to palpitate when their model’s R-squared creeps upward toward 1.0, but nobody else is really moved by the square of the correlation coefficient.

This simple piece of advice stuck with me, and years later it gave me the confidence to develop a system that asks just one question to predict promoter, passive or detractor categories. That may not satisfy some hard-core number crunchers, but it has made a huge difference—both in my career and for the thousands of companies that have adopted Net Promoter.

In fact, we initially chose the question “How likely would you be to recommend my company to a friend” because it most strongly predicted what customers were likely to do based on their answers. Over time, we also learned that employees take their reputation seriously, so the customer’s response motivated action. Part of the power of the Net Promoter system is that it is based on a simple model that requires one simple question, yet it drives real, actionable feedback that helps companies grow.

Most humans aren’t fired with a passion to act when they see the results of a complex, multivariate regression formula. But they do take it personally when a good customer tells them that they would not recommend them to a friend.

METALLICA - ONE - DRUM COVER BY MEYTAL COHEN

When it comes to professional services firms, young employees are often unfamiliar with the concept of marketing. They are unaware of the many quick and easy things they can do to advance their careers and help their firm reach its growth goals. Much of a professional’s early years are spent mastering professional skills, learning client service, and knocking out billable hours. While these are all certainly important areas, this scenario presents a challenge for young professionals as they begin to rise through the ranks. At a certain point, they may feel that they have hit a ceiling where they need to begin marketing in order to continue advancing. Or maybe they have already climbed to that point and have been tasked with bringing in new business through marketing and business development. Young professionals may find themselves thinking, “What is this marketing stuff? I don’t have time for this!” The great news is that young professionals (and all professionals for that matter) can use thought leadership and their subject matter expertise to propel themselves forward in their careers without having to invest a lot of precious time.

One of the best things young professionals can do to begin developing a “marketing mindset” at an early stage is to monitor and share thought leadership.Thought leadership is simply providing content that your clients and prospects will find useful and informative. It can also draw on your expertise in a particular subject matter in order to help your audience learn something they are interested in or solve a problem. The following tips can help you monitor and share thought leadership:• Monitor clients, prospects, and competitors online. One of the key ways you should be using online tools is to keep a close eye on any people or enterprises that might impact your business, either in a positive or negative way. This is often referred to as gathering “online intelligence.”• Stay abreast of what is going on in your industry so you can react swiftly and accordingly. Be the first to share breaking industry news with your clients, coworkers and online professional network, and they will begin to think of you as a resource for the latest industry info.• Use tools like Google Reader, Google Alerts, LinkedIn Signal and Scoop.it to gather online intelligence. Be sure to share the information with partners, coworkers, and via social networks like LinkedIn.• You will stand out from the crowd by providing valuable information to clients and prospects if you are educating and informing them.• Through regular distribution of content (content marketing) and social media, you can build an engaged community of followers. The key is to find and share useful content.One of the greatest things about monitoring online intelligence and sharing thought leadership is that it gives you a means to easily establish credibility and “expert” status among peers, clients, and prospects.Establishing subject matter expertiseAnother often overlooked tool for establishing professional expertise and gaining visibility for your firm is leveraging media relationships. You want journalists and other media professionals turning to you for your professional advice and hopefully sharing your expertise with their established audience. In search of savvy tips on how to leverage the media, I turned to Public Relations expert Debbie Goetz for her insight on this topic. Here are Debbie’s top tips for how to get the media to turn your way for professional advice and subject matter expertise:• Media people love “tips.” Think about what tips you can offer to individuals or business people about your particular industry. Then share these tips with the media by email, phone or social media.• Be sure to stay up-to-date on top current events, trends and industry updates, as well as their implications for individuals and businesses needing your firm’s services.• Approach the media as an expert when there is something related to your industry in the news. For example, accountants might be able to weigh in on timely tax law changes.• Try to submit articles to local or trade publications about newsworthy topics.• Follow business reporters in the newspaper and online by subscribing to their news/blog feeds, following them on Twitter, and connecting on LinkedIn.• Send media contacts an email or tweet when you like something they wrote or to offer additional insight into a topic they covered. Get to know them so that they can get to know you and use your expertise when the right opportunity arises.• Sign up to receive HARO updates and respond to queries relating to your field of business.• Be sure your LinkedIn profile is well developed and up-to-date. Join LinkedIn groups of like-minded professionals. Start discussions and participate in the discussions of others to establish your subject matter expertise.Following these straightforward tips on a consistent basis is all it takes to get the media to take notice of your professional expertise, and to eventually tap you for your industry knowledge and subject matter proficiency. Coupling these tactics with the regular monitoring and sharing of thought leadership will not only make the media pay attention to your savvy, but it will also catch the eye of partners and shareholders, setting you up to be a rising star within your firm.

Social Gaming : Friends Who Play Together, Stay Together

I just posted my 100 win in Scrabble which I play frequently on my mobile phone. It was a fun game as always, but what made it particularly noteworthy was the fact that I was playing with a friend who is halfway around the world in India. Like many of you, I remain in touch with several of my friends using Facebook which has been instrumental in renewing old connections and long lost friendships. With over one billion users, Facebook has become the predominant way in which many people keep in touch with friends, acquaintances and coworkers. Facebook has had one other remarkable effect; it has turbo charged a trend that was already gaining much momentum over the last decade: social gameplay. This is the third, and in my opinion, the most important secular force that is driving the massive growth in videogaming.

Usually when you hear the term “social gaming” you think of it meaning just games on Facebook, but that’s not the case. Now, you can connect with your friends and play with or against them on every gaming platform. Games like Madden, FIFA and Need for Speed all feature co-op and challenge modes. At EA, nearly every game that is under development is being built to enable rich experiences in social connected play.

Videogames which were originally built predominantly for single user play have rapidly evolved over the last several years to incorporate many capabilities that enable co-op play and gaming with friends. There have always been specific games that enabled multi-user online play in the past, but the recent ubiquity of compute and graphic power in so many new devices, the associated pervasiveness of broadband connectivity and the large global footprint for gaming has been profoundly impacted by the ability to engage in social play. We now have algorithms that enable logical matchmaking inside games, multithreaded game engines, sophisticated rendering systems and web services that power secure connections enabling chat and other real time interactions. These have been key technologies driving the growth. To embrace these trends, companies have to rethink the fundamental design of the core software and invest in underlying platform technologies. The technical challenges are non-trivial to enable synchronous and asynchronous online connected experiences and bridge diverse social networks across all device types. It does take a concerted effort in every part of the organization to make this happen. But the results are well worth it.

The impact has been dramatic. Not only is gaming more fun and immersive, the consumer engagement in these connected social play modes is much deeper than in other modes. We are starting to see the impact of social connectivity on the frequency of play, session lengths and the most important factor of all, which is consumer satisfaction. Playing a game with friends or like-minded community adds a whole new level of immersiveness in the experience that a single user mode against the pre-programmed AI logic of a machine can’t substitute.

Every software product or service can benefit from the same secular trends that are catalyzing the video game industry. Transitioning products that in the past were limited to local networks or single-user mode, can benefit tremendously by the addition of social and community features. Whether it is something as simple as an “Ask the Community” feature that have shown up in products like Turbo Tax or user-generated content that powers the stickiness of sites like Amazon and Yelp. Every organization that builds software should be asking itself the fundamental questions of how they can serve their consumers better by embracing technology enhancements, globalization and social functions.

I’d love to hear your thoughts on these three trends I’ve covered and hear your favorite game to play against your friends.

If You Like Accounting and TV, Keep Reading

You’re reading AICPA Insights, so I can safely assume that you’re interested in accounting. And since I’m making assumptions, I’m going to assume that you like to watch TV (hey - all the cool kids are doing it). And since you’ve got an inquisitive mind, I bet you wonder how networks decide which shows get made and which shows on TV "make it." Maybe, you got a little fix watching the People’s Choice Awards last month. And since then, you’ve been twiddling your thumbs as you count down the days until the Emmys. Well keep reading, because I have just the thing for you.

Let me set the scene…The TV industry is booming and each network is in search of “the next big thing.” At the same time, accounting is in the spotlight as one of the fastest growing professions. Put the two together, and the network executives have decided this is a profession that should play a role in their next pilot. That’s right, it’s the AICPA’s Project Innovation: Competition of Creative Excellence.

“The AICPA decided to challenge high school students to create a potential TV pilot, while offering a fun and exciting way to learn about accounting and the CPA profession,” said Heather L. Bunning, AICPA Sr. Manager, High School and Community College Initiatives.

The competition recently moved into the public voting period, which runs until February 27. That means you (you!) can check out the finalists’ videos and cast a vote for your favorite.

“Our judges have selected the best pilots and since building a fan base for their show is a must, the online vote will factor into the final decision,” said Bunning.

The finalists have been carefully selected based on their proposal, which provided an overview of the show, including a production budget and the script they used to pitch the network – a panel of judges appointed by the AICPA. The finalists then received a video camera to bring their script to life as a three-minute preview of their pilot.

The last step of the competition will include a live presentation to a final round judge, who plays a key decision maker at the network. This will give teams one last chance to explain why their show will be a smash hit, and why they should be crowned the winners.

With a total of $15,000 in scholarships for students and grant money for their schools going to the top three teams, the stakes are high – so check out Start Here, Go Places. and vote for the show you would most like to see spotlighting the accounting and CPA profession. Winners will be announced in mid-March.

Monday 11 February 2013

The Microsoft Surface Pro Proves That The PC Is Back

I come bearing glad tidings. After decades of OEM malaise, a constant parroting of the speeds and feeds mantra, and an aesthetic that was formulated in the back room of a dingy Staples office supply store, the PC is really back.

In short, the Surface Pro is so good that it could drive Windows 8 adoption with enough force to make people reconsider Microsoft’s odd new OS. Microsoft bet the farm on a new paradigm and it needs a champion. Surface Pro is the right hardware for the job.

I haven’t been a Surface apologist and, although I’ve seen Windows 8 as more of a success than a failure, no hardware has truly made me see the value of the platform until this model Surface. But enough effusive praise, let’s look at the hardware.

Back in November I noted that Microsoft launched the Surface RT long before the platform was stable or even interesting. The RT, as you’ll remember, runs a quad-core Cortex-A9 ARM chip clocked at 1.3 GHz. It’s not awful, but it’s not great, either.

This model attempts to right those wrongs by turning the Surface from a “tablet” device into a what essentially amounts to a Windows laptop.

This is an important distinction. The Surface isn’t supposed to be a tablet you drop on the coffee table and use when you want to look up something on IMDB. It’s a powerful computer with enough speed and graphics chops to give any other manufacturer’s laptop a run for its money. Previous Windows tablets have been hampered by a strange and messy amalgam of interfaces, pen input, and a focus on the slate form factor. This device, on the other hand, is a real hybrid – a laptop that is also a tablet that is also a media consumption device. You will use it just like you use a laptop whereas, by definition, the hobbled RT version of the Surface is meant to be used as a tablet.

In examining the Surface Pro we must remember that, physically, the Pro is essentially the same device as the Surface RT. It is very slightly thicker at exactly a half inch versus .37 inches for the RT. It is also a half a pound heavier than the 1.5 pound RT. Surface Pro comparison

The system runs an Intel dual-core 1.7GHz Core i5 chip and comes with 64 or 128 GB of storage (although, as mentioned all over the web, the 64 GB has only 23 GB available and the 128 GB model has only 83 GB available. The rest is taken up by system files.) It has a microSD slot on the right side, one USB 3.0 port, a mini DisplayPort, and a headphone jack. It uses a magnetic charging system that snaps, with some degree of difficulty, into a little slot on the side. It has 4GB of memory and a 1920×180 pixel 203ppi screen with 16:9 aspect ratio.

The device also uses a Wacom digitizer and is compatible with Wacom pens. This is a boon for artists and designers as it means you have varying levels of pressure available when drawing on screen. You can also use the pen to control the on-screen interface, although I far prefer a mouse or, barring that, a finger on the touchscreen.

Everything that people loved/hated about the RT is here: the loudly clicking magnets that hold in the power adapter and keyboard, the kickstand that hides itself away when not in use, and the glossy screen with touch-sensitive bezel. The kickstand alone is worth a few hours of Mac-lover ridicule or Windows-lover bemusement. Kickstands are for mid- to high-tier Android phones, not tablets, they’ll say as they attach cases that fold into kickstands to their iPads and Galaxy Tabs. I personally found the kickstand to be very useful when the Surface is in laptop mode although the lack of angle control is limiting. In short, the kickstand is a cool idea and integral to the Surface experience even if it does increase the overall footprint by two inches.

In terms of usability I had no trouble learning the vagaries of Windows 8 on this device or actually enjoying the experience. That’s right: I liked Windows 8 on this for the simple reason that the balance between Classic and Touch UIs (which is what I’ll call Metro here) was easy to understand. This balance doesn’t help Microsoft convince us to use Touch more – you still tend to land in classic mode more often than not – but it does make Windows 8 far more usable.

Plenty of ink has been spilled by those complaining about Windows 8 and the Touch UI. While I would be loath to hand this device to a novice Windows user, once you get a hang of the new interface it’s quite simple. Much of the Start menu functionality ends up in the “tiles” Touch interface while the search button makes it easy to find and run apps. As more apps use the interface I think the Classic mode will be phased out. Until then, you’re sort of stuck in UI limbo.

That said, how does this device fare as a computing/content creation platform? It's A Laptop!

’ve been using the Pro as my primary laptop for the past week and even traveled with it. As a Mac snob this is a fairly unique turn of events. Usually I would test a laptop for a few days and revert back to my MacBook.

As a laptop it is excellent. I was able to do nearly everything I needed to do including the editing of large documents, photo management, blogging, some minor gaming, and plenty of email and web browsing. I did run into some trouble while trying to play Civilization V. The game froze for a while and then launched in “touch” mode, thereafter sitting underneath the task bar where various features were hidden from my mouse. Amnesia didn’t run at all out of Steam. However, Microsoft did show proof that games like Far Cry played on the Surface. It’s hard to fault the company for third-party titles when nearly every other app ran just fine on the platform. Even Minecraft, that paragon of high-performance gaming, ran beautifully. Many of the issues are associated with running a keyboard and mouse-based title with a touchscreen device and should be remedied over time.

In terms of media features, much of that has been addressed in reviews of the RT and Windows 8. I was pleased to note that the screen resolution was excellent – 1920×1080 is nothing to sneeze at – and Microsoft’s “ClearType” display is very nearly on par with Retina screens, at least at first blush. There are definite pixels visible on this screen but on the whole the display is bright, eminently readable, and offers excellent contrast. Reading on this screen, for example, is a pleasure and casual games like Angry Birds work just as they would on a similarly outfitted tablet.

The Pro has two 720p cameras, a front-facing one for web chat and a rear-facing for taking in the world. Neither are particularly amazing but they are useful for web chats, etc.

Back Camera

Media playback is excellent and barring some codec problems with some of the video I played on it, the Surface Pro handled video amiably. I was able to see about five hours of video playback in Battery Saver mode which was just enough for a trip to San Francisco from New York. I set the Surface up against the back of the seat in front of me, hid away the keyboard and mouse, and used it just as I would normally use my iPad.

To be clear this solution is not absolutely ideal. Once you take off the keyboard and mouse, the Surface Pro becomes less interesting. Most major games are difficult or impossible to play without alternate input systems and apps like Windows are marginally useful. This is far from a deal-breaker, obviously, because the two use cases are so disparate and having the option of turning the Surface into a tablet or an ultralight laptop is the main benefit of the form factor.

Is this the ideal tablet? No. However, as an amalgam of workhorse and media consumption device it is one of the best I’ve seen. Even convertible laptops are far bulkier and fare worse. The Lenovo Yoga, for example, was a solid touchscreen laptop with some tablet features but its bulk was a bit too much to handle on the road. This device, on the other hand, is Windows condensed. It offers an excellent form factor and the fact that solid performance is a click away is compelling.

The Pro costs $899 for the 64GB model and $999 for the 128GB model, a pricing scheme that tells you a lot about how much solid state memory is worth these days. It’s clear that these price points will aim the users to the roomier model. This price includes a Surface pen.

Microsoft is also selling a $70 “wedge” mouse that is little more than a wedge of plastic and two buttons. I’ve been using it extensively and it’s been quite a lifesaver while mousing around in classic Windows.

At $1,000, you’re paying about as much as you’d pay for a MacBook Air or a more powerful Windows laptop. Is this premium worth the investment? I’d say that it ultimately depends on how you intend to use this system. If it’s a laptop replacement as in something you carry on trips or to meetings, then yes. This is a stable and solid machine and will turn heads when you open it up.

As a tablet, on the other hand, I’d say that you’re probably better off looking elsewhere. Given that most Windows tablets are hovering around $1,000anyway, it’s probably not the best time to pick up a Win8 model (unless it’s the Surface.) Manufacturers will begin the race to the bottom soon enough and the $600 Win8 tablet isn’t too far off.

The $899/$999 prices are a signal: Microsoft wants you to buy the 128GB model. Much ado has been made of the fact that you really only get 82GB but I don’t recall folks complaining when their laptops came full of Windows system files and bloatware. This device comes, out of the box, ready to rock. Apps aren’t that expensive or particularly big and barring the handling of huge files, you’re not going to run out of storage immediately. Will you run out eventually? Absolutely, but presumably you can stick some of your files on a microSD card and carry that around as well. It’s a trade-off, obviously.

Now for some of the bad news. There’s not much I can complain about but the stuff that I did notice is definitely annoying. The type cover and inputs are flawed. The touchpad on the type cover is woefully small and the connection between the keyboard and the device is often wonky, disconnecting at odd intervals. The touchscreen interface, while excellent in Touch mode, is difficult to manage in Classic mode. This problem is intermittent and didn’t get in the way of solid hours of usage over the past few weeks. I won’t pretend that these aren’t real problems (for example: “I’m writing this without hitting some keys again, resulting in huend up words.”) That muddled word is “mashed.”

It seems that this problem is related to the stability of the surface on which the device and keyboard are sitting. On an airline tray, for example, the problem is horrible. On a solid kitchen table the whole thing works perfectly.

To solve this I’ve taken to keeping the device on a desk and using the wedge mouse as a pointer. I’ll raise my hand occasionally to use Touch mode, but I’m mostly using the Classic experience because most of the apps I use are trapped in that Forbidden Zone of “old” Windows.

The hardware can run hot – there’s a real Intel chip in there – and it stays hot for some odd reason even after being shut down. This behavior reduced a full battery from 100% to about 80% overnight, which wasn’t pleasant. Leaving it “open,” namely with kickstand up and keyboard attached without pressing the power button, made the device run down in about four hours of non-use. Obviously this is a question of settings but you expect this thing to work like a tablet, not a laptop.

Battery life in Balanced mode is about 3 hours and about 5 hours in Power Saver mode. This is enough to watch a few movies on a flight but not quite the five hours I’d like to see out of a device of this size. Power Saver mode can improve that battery life by about an hour.

For $1,000, Microsoft could have put a longer power cord on this thing. The cable is about four feet long and the actual power cable – the side that goes into the wall – is shy of two feet.

But that’s the trade-off: RT gives you tablet features by cutting your options and Pro gives you PC features by chewing up the battery. The first company to meld the two, in my mind, wins this battle.

Given the value of the Surface Pro to Microsoft’s brand, it’s easy to see why the company opened their Surface kiosks this holiday. I read the reports of cheery salespeople flogging Surface RT with plastic smiles and an obsession verging on evangelical with a grin of Schadenfreude. Now I understand what happened: they were selling the wrong Surface. Those ham-handed sales pitches should have been saved for this model Surface. The RT, as exciting as it seemed at the time, is clearly the runt of the Surface litter. While the OS X/iOS vision Apple put forth worked for their mobile devices, Win8 without an Intel chip, at this point, offers a truncated expression of this platform’s power.

The joke going around the pro-Surface RT crowd a few months back was that nobody wanted to run a 1998 copy of Peachtree Accounting on their sassy new Surface. I would argue that they are dead wrong. Without the benefit of a solid base of apps – or at least the perception of a large collection of useful apps and potentially a larger collection of garbage apps – a device that runs only Win8 and is not backwards compatible will alienate a Microsoft’s large base.

To those who snicker at Win8 in general I will say this: this is the direction in which Microsoft is going, and to deride it is tantamount to hindering progress. To use a musical analogy, those who wish that Jamiroquai would return to the glory of Virtual Insanity will be gravely disappointed and the only way forward for a fan of Jay Kay or Em Ess is to accept that change is inevitable.

I’m not a constant or dedicated Windows user, yet I am very excited about the Pro. It is Microsoft at its best – a pure expression of some computing solution that is more akin, say, to the Xbox 360 than the Dell Adamo. This is not a laptop that looks weird being sold at a premium. Instead it is a hybrid device that works surprisingly well as both a laptop and a tablet. There are obviously trade-offs, but the simplicity of form, the excellent design, and the promising OS make the Surface Pro a real treat – and threat to other manufacturers.