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Mobility was a $1.8 billion business for Tech Data last year, but it's not the only big shift. About $7.5 billion came from data center technology, $3.5 billion was from consumer electronics and $4.6 billion was from software. How did that shift come about?
About five years ago, we started to diversify away from the desktop. For 35 years, all we had to do was answer phones. We grew up in the desktop space. It took a new set of core competencies. Tech Data grew up in the Intel world. From our point of view, the agenda in IT is set by the consumer. You hear the concept "prosumer," the professional consumer. We decided we would open our eyes to the consumer space. Don't forget five years ago they were Apple Computer. Now they're Apple. They're a CE company, not a computer company. We drove ourselves into those four areas. We're divesting out of things like printer cartridges and investing in things like data center.
We're moving away from less profitable products and moving toward more profitable. We have a very different revenue stream now, and as a result, you see 3 percent revenue growth, but operating income [growth] is 12 percent and net income [growth] is 14 percent.
What's your view of Microsoft Surface? Is that going to cause problems for your other tablet vendors and for you as a result when Windows 8 comes out?
All hardware vendors have built platforms. The day Windows 8 comes out, there will be all kinds of hardware alternatives in the market. Whether they use the channel or market today or tomorrow, there will be enough alternatives out there.
Do you think Windows 8 can be a big play in the tablet space? Microsoft really hasn't said much to garner a lot of hype around it.
Do you remember two years ago at CES? It was the Year of the Tablet. There were 40 Android tablets announced. We picked five of them. We didn't pick 40. Those five have created the 5 percent share that other guys [besides Apple] have. But, I think Windows 8 will be the first real competitor to be an alternative tablet solution. You have to let it play out in the marketplace. It's not Android. It's Windows. And, there are tens of millions of business users today that use Windows. A lot of those are going to look at a Windows tablet in a positive way.
Then when is Microsoft going to start talking about it?
It's coming. Trust me, it's coming. Microsoft has a very well-defined calendar of events. You'll see a lot of information around Windows 8 [tablets] starting next month.