Microsoft's first crack at the market of tablet hybrids didn't go so well. Mostly, it was a misguided and confusing attempt to take on Apple's iPad, which was at the time the only slate that mattered. A few years later, and Microsoft may have finally cracked the hybrid formula. It's just too bad this thing is so expensive.

The Surface 3 (not to be confused with the Surface Pro 3), is a 10.8-inch tablet/laptop that sports a beautiful design, stylus support, and a full version of Windows 8.1. It's not a powerhouse—it comes equipped with an Intel AtomX7 CPU—though it's just good enough to run all of your favorite legacy Windows desktop apps. In theory, it should be enough to replace your iPad and aging computer.

But, as we saw in our performance tests, it really depends on what type of user you are in order to really justify the price. The model we tested was the upgraded model, which comes with 4GB of RAM and 128GB of internal storage; the other model, which retails for $499, comes with 2GB of RAM and 64GB of internal storage; both come with microSD slots, full-size USB 3.0 and an 8-megapixel camera on back. You know, just in case.

If you simply want to edit documents and browse the Web, the Surface 3's entry $499 is a nice alternative to an iPad and other tablets of similar size. But in order to really feel like this is a capable machine, your best bet would be to go with the 4GB model, which starts off at $599; couple that with the optional Type Cover, which goes for $129, and the price starts to get beyond reasonable territory.

Buy/Wait

Microsoft is very clearly aiming this as an iPad replacement—it dedicates a lot of space on its website to comparing the two. In that regard, the Surface 3 is certainly plenty capable, and will allow you to perform a lot of tasks Apple's device cannot. But as a complete tablet and laptop replacement, you're beginning to swim in murky waters.

We found that, while the more expensive Surface 3 is capable plenty of everyday tasks, performance takes a hit when put under more intensive pressure. Open up several tabs, run a few videos, and you'll certainly notice that the Atom processor isn't the most powerful CPU on the market. That's where price comes back into the equation.

To really get the most out of the Surface 3, you should really go for the more expensive $599 model, and also get the optional $129 keyboard. When all is said and done, that's $730 before taxes. You can also buy a docking station, though I wouldn't recommend it at a whopping $199. At roughly $800, however, you're getting mighty close to Surface Pro 3 territory, which is a much more powerful and capable machine.

The idea is terrific, and the execution is mostly there. But the price is what worries me the most. Yes, you get a full version of Windows, but you can find a lot of very cheap, very excellent laptops in the same price range as the entry Surface 3. You do get a free year of Office 365, which is great for students. If price isn't an issue, the Surface 3 is a great device that's worth a look.

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