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Field effect transistors based on a hydrogen induced p-type surface channel (surface channel FETs) have shown steady progress in the past. Devices with sub-μm gatelength have been fabricated and cut-off frequencies up to the mm-wave range could be extracted. However, large signal and power performance could only be reported recently. This is due to severe stability and degradation problems. These phenomena are largely related to the highly polar H-terminated diamond surface, although details are still in discussion. This contribution describes these instabilities and the recent progress obtained. To some extent this may also shine some light onto the nature of instabilities observed in GaN based devices.