Sent from Windows Mail From: Steve Ballmer Sent: November 4, 2012 7:43 AM To: Steven Sinofsky CC: Kevin Turner Subject: RE: Surface sales physics after a week We all agree we need to expand distribution How and when have not been discussed amongst the three of us is chris cap looped in From: Steven Sinofsky Sent: Sunday, November 4, 2012 6:51 AM To: Steve Ballmer Cc: Kevin Turner Subject: RE: Surface sales physics after a week What do you want to learn? What other data can we provide? Surface is about to catastrophically fail in a very public way. We don't know how to explain selling 1/10th the number of devices as the lowest end of the lowest expectation. Word will get out very soon. There is no long term without this. From: Steve Ballmer Sent: 11/4/2012 6:35 AM To: Steven Sinofsky Cc: Kevin Turner Subject: RE: Surface sales physics after a week This is a huge decision with ramifications on consumers, retailers and oem's Our OEM's would certainly be upset given their expectations The timing does not allow care I think we need a discussion with you KT, me, tami, and chriscap at min to walk through I do not want to make a mistake on this the downsize seems large compared to short term upside What margin are we thinking for the retailers on the various sku's that was never really worked through to the best of my knowledge thanks for pushing I am in Europe all week It will be tough but perhaps we can do a phone call with all relevant parties. I cannot say yes based on what I know I did call KT on Saturday afternoon and this plan was news to him too 12 EFTA_R1_01741995 EFTA02572399