The Surface is a touchscreen tablet with a 10.6-inch high definition screen. It will run Windows 8 Pro or Windows RT (more on that in a moment)--using the tile-based operating system familiar to Windows Phone users.
What Microsoft demonstrated on stage at its press event looked interesting. At least, some of it did. There were clever bits of innovation--most specifically, the -esque Touch Cover and Type Cover. Each connects magnetically to the Surface to protect its screen, and each can trigger the same sleep/wake behavior that the iPad Smart Cover (and now, the ) achieves. The innovative part is that the covers double as keyboards for the Surface: The thinner Touch Cover uses a multitouch keyboard--the keys don't move under your fingers, but you can rest your fingers on them without typing. The thicker Type Cover uses actual buttons.
No one outside of Microsoft has had the chance to use one of the Surface covers in tandem with a functioning Surface just yet, so it's hard to say how well the setup works. Still, integrating a keyboard into the cover is an awfully clever idea, and Apple has never been shy about improving upon innovations from elsewhere--see the original Mac OS, the iPod, and Notification Center for examples from three different eras in the company's history.
Some Surface elements, however, don't seem likely to catch Apple's eye: The integrated kickstand seemingly defines the Surface as a landscape-orientation only device, and isn't compatible with the smooth aesthetic Apple favors.
Of course, we won't really know how good (or not) the Surface is until we can truly get our hands on a functioning version of the device. In the near-term, though, while Apple might be intrigued, I doubt Cupertino is ablaze with panic in the aftermath of Microsoft's Surface unveiling.
For one thing, the Surface is saddled with various elements that scream "Microsoft." Most prominently, it will be sold with two different underlying architectures: an Intel-based model running Windows 8 Pro, and an ARM-processor-based model running Windows RT. Both models will be heavier than the iPad, though the Windows RT version may end up being slightly thinner than the iPad, Microsoft says. Only the Windows 8 Pro surface can run regular Windows apps in addition to touch-optimized ones. The two models will come in different size configurations.
iPad purchasing isn't without complexity of its own: Customers need to choose whether to get Wi-Fi-only models or cellular versions, and then between two different cellular carriers in the U.S. Microsoft didn't announce any plans to include cellular connectivity in the Surface.
Both Surfaces will feature a USB port, Mini DisplayPort, and a micro-SD card slot. There's plenty of real-world use for those ports, but again, it's exceedingly unlikely that Apple would add such features to the iPad--so those likely don't intimidate Apple much, either. And, true to Microsoft's seeming goal to satisfy all use cases, the Surface will ship with a stylus, too.
In truth, though, Apple's head start here is enormous. The App Store includes ; there are currently zero third-party apps designed for the Surface. While Microsoft will surely court the largest app makers and encourage them to develop for its platform, .
For some customers, a tablet must run some flavor of Windows to interest them. Apple's never going to win those customers over, and needn't worry about them. For everyone else, there's the iPad, a series of also-ran not-iPads, and the better-faring ebook tablet market dominated by the Kindle Fire and Nook Color. Microsoft's Surface will need to get a wide customer base to motivate app makers to develop for it--the same Catch-22 that continues to hamper acceptance of Windows Phone.
And there are two other key elements that the Surface still lacks: a ship date and a price. The former isn't too important; no tablet maker has yet threatened the iPad's strong hold on the market, and Microsoft can't really get further behind than "very, very behind" as it already is. The price point, though, is hugely significant. If Microsoft can't compete with the iPad's $499 starter price--let alone the iPad 2's $399 price tag--it's hard to imagine how, barring huge as-yet-unannounced innovations, it could threaten Apple much at all.
Now, if your core business model is making Yet Another Android Tablet that looks like an iPad but is demonstrably inferior, I think you're right to feel a bit nervous that Microsoft is making a play here. And I wouldn't be shocked if the ultrabook market finds that Windows customers prefer the Surface's approach. So even if Apple needn't be worried just yet, I think a few of the competitors it shares with Microsoft ought to be.