Electronic Arts 2015 Annual Report Download - page 88

Our business is subject to risks generally associated with the entertainment industry, any of which could
significantly harm our operating results.
Our business is subject to risks that are generally associated with the entertainment industry, many of which are
beyond our control. These risks could negatively impact our operating results and include: the popularity, price
and timing of our games and the platforms on which they are played; economic conditions that adversely affect
discretionary consumer spending; changes in consumer demographics; the availability and popularity of other
forms of entertainment; and critical reviews and public tastes and preferences, which may change rapidly and
cannot necessarily be predicted.
We rely on business partners in many areas of our business and our business may be harmed if they are
unable to honor their obligations to us or their actions may put us at risk.
We rely on various business partners, including third-party service providers, vendors, licensing partners,
development partners, and licensees, among others, in many areas of our business. The actions of our business
partners may put our business and our reputation at risk. In many cases, these third parties are given access to
sensitive and proprietary information in order to provide services and support to our teams. These third parties
may misappropriate our information and engage in unauthorized use of it. The failure of these third parties to
provide adequate services and technologies, or the failure of the third parties to adequately maintain or update
their services and technologies, could result in a disruption to our business operations. Further, disruptions in the
financial markets and economic downturns may adversely affect our business partners and they may not be able
to continue honoring their obligations to us. Alternative arrangements and services may not be available to us on
commercially reasonable terms or we may experience business interruptions upon a transition to an alternative
partner or vendor. If we lose one or more significant business partners, our business could be harmed.
We may be subject to claims of infringement of third-party intellectual property rights, which could harm
our business.
From time to time, third parties may assert claims against us based on allegations of violations of intellectual
property rights. In addition, patent holding companies seek to monetize patents they have purchased or otherwise
obtained. Although we take steps to avoid knowingly violating the intellectual property rights of others, it is
possible that third parties still may claim infringement. In addition, our products often utilize complex, cutting-
edge technology that may be subject to intellectual property claims, particularly since there are an increasing
number of companies that focus their efforts exclusively on enforcing their patent rights.
Existing or future infringement claims against us, whether valid or not, may be time consuming and expensive to
defend. Such claims or litigations could require us to pay damages and other costs, stop selling the affected
products, redesign those products to avoid infringement, or obtain a license, all of which could be costly and
harm our business. In addition, many patents have been issued that may apply to potential new modes of
delivering, playing or monetizing game software products and services, such as those that we produce or would
like to offer in the future. We may discover that future opportunities to provide new and innovative modes of
game play and game delivery to consumers may be precluded by existing patents that we are unable to license on
reasonable terms.
From time to time we may become involved in other legal proceedings, which could adversely affect us.
We are currently, and from time to time in the future may become, subject to legal proceedings, claims, litigation
and government investigations or inquiries, which could be expensive, lengthy, and disruptive to normal business
operations. In addition, the outcome of any legal proceedings, claims, litigation, investigations or inquiries may
be difficult to predict and could have a material adverse effect on our business, operating results, or financial
condition.
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