Symantec 1999 Annual Report Download - page 44

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technologically successful. If they are not technologically successful, our resulting products may not achieve market
acceptance and our products may not compete effectively with products of our competitors currently in the market or
introduced in the future.
The length of the product development cycle is difficult to predict. The length of our product development cycle
has generally been greater than we originally expected. Although such delays have undoubtedly had a material
adverse affect on our business and because we are unable to predict the amount of net revenues that would have been
obtained had the original development expectations been met, we are unable to quantify the magnitude of net revenues
that were deferred or lost as a result of any particular delay. We are likely to experience delays in future product
development. These delays could have a material adverse affect on the amount and timing of future revenues. Due to
the inherent uncertainties of software development projects, we do not generally disclose or announce the specific
expected shipment dates of our product introductions.
We may be unable to adjust expenses to fluctuations in revenues. As with many companies in the software
industry, our employee and facility related expenditures comprise a significant portion of our operating expenses. We
base our expense levels, in a large part, on projections of future revenue levels. Due to the fixed nature of these
expenses over the short term, if revenue levels fall below expectations, our operating results are likely to be
significantly adversely affected.
We must manage and restructure our expanding operations effectively . We continually evaluate our product and
corporate strategy. We have in the past undertaken and will in the future undertake organizational changes and/or
product and marketing strategy modifications. These changes and modifications are designed to:
• maximize market penetration;
• maximize use of limited corporate resources;
• develop new products; and
• develop new product channels.
These organizational changes increase the risk that objectives will not be met due to the allocation of valuable limited
resources to implement changes. Further, due to the uncertain nature of any of these undertakings, these efforts may
not be successful and the Company may not realize any benefit from these efforts.
We must attract and retain personnel while competition for personnel in our industry is intense. We believe that
our future success will depend in part on our ability to recruit and retain highly skilled management, marketing and
technical personnel. Competition in recruiting personnel in the software industry is intense. We may be unable to
attract or retain our key employees or to attract, assimilate and retain other highly qualified employees. We have from
time to time in the past experienced and we expect in the future to experience difficulty in hiring and retaining skilled
employees with appropriate qualifications. To accomplish this, we believe that we must provide personnel with a
competitive compensation package, including stock options, which requires ongoing stockholder approval.
We depend on our internal communications systems that may be disrupted. Our order entry and product shipping
centers are geographically dispersed. If our communications between these centers are disrupted, particularly at the
end of a fiscal quarter, we will suffer an unexpected shortfall in net revenues and a resulting adverse impact on our
operating results. If communications and Internet connectivity are disrupted, disruptions in communications and
Internet connectivity may also cause delays in customer access to our Internet-based services or product sales. A
business disruption could occur as a result of natural disasters or the interruption in service by communications carriers
and may cause delays in product development that could adversely impact our future net revenues.
We rely on intellectual property and proprietary rights. We regard our software as proprietary and underlying
technology as proprietary. We seek to protect our proprietary rights through a combination of confidentiality
agreements and copyright, patent, trademark and trade secret laws. However, we do not employ technology to prevent
copying of our products. Despite our precautionary measures, third parties may copy aspects of our products or
otherwise obtain and use our proprietary information without authorization or develop similar technology
independently. All of our products are protected by copyright and we have a number of patents and patent applications
pending. We may not achieve the desired protection from, and third parties may design around, our patents. In
addition, existing copyright laws afford limited practical protection. Furthermore, the laws of some foreign countries
do not offer the same level of protection of our proprietary rights as the laws of the United States. Any legal action
that we may bring to protect proprietary information could be expensive and may distract management from day-to-day
operations.