Microsoft Gives Up On Brick-and-mortar Retail

Microsoft said on Friday it will close its stores around the world, moving its retail operations online and keeping only four locations that will be transformed into "experience centers."

The move means the estimated 100 Microsoft stores closed due to the coronavirus pandemic will not reopen as the tech giant enters "a new approach to retail," according to a statement.

"Microsoft will continue to invest in its digital storefronts on Microsoft.com, and stores in Xbox and Windows, reaching more than 1.2 billion people every month in 190 markets," the statement said.

The four locations that will become Microsoft Experience Centers are in London, New York, Sydney and at the compay's Redmond, Washington headquarters.

Retail team members will "serve customers from Microsoft corporate facilities and remotely providing sales, training, and support," the company said.

Microsoft said it will set aside US$450 million to cover the costs of closing the locations.

"Our sales have grown online as our product portfolio has evolved to largely digital offerings, and our talented team has proven success serving customers beyond any physical location," said Microsoft corporate vice president David Porter.

"We are grateful to our Microsoft Store customers and we look forward to continuing to serve them online and with our retail sales team at Microsoft corporate locations."

Microsoft in recent years has been relying more on its enterprise services such as cloud computing, with the retail locations focusing on its Surface tablets and laptops as well as Xbox gaming gear. But the physical stores failed to gain the momentum of rival Apple.

Independent technology analyst Neil Cybart said the closings are coming because "the Surface business increasingly looks to be losing momentum in the consumer space." (AFP)