Symantec 2012 Annual Report Download - page 96

• Recent consolidation of electronics retailers has increased their negotiating power with respect to
hardware and software providers
OEM Sales Channels. A significant portion of our revenues is derived from sales through our OEM
partners that incorporate our products into, or bundle our products with, their products. Our reliance on this sales
channel involves many risks, including:
• Our lack of control over the volume of systems shipped and the timing of such shipments
• Our OEM partners are generally not subject to minimum sales requirements or any obligation to market
our products to their customers
• Our OEM partners may terminate or renegotiate their arrangements with us and new terms may be less
favorable due to competitive conditions in our markets and other factors
• Sales through our OEM partners are subject to changes in general economic conditions, strategic
direction, competitive risks, and other issues that could result in a reduction of OEM sales
• The development work that we must generally undertake under our agreements with our OEM partners
may require us to invest significant resources and incur significant costs with little or no assurance of ever
receiving associated revenues
• The time and expense required for the sales and marketing organizations of our OEM partners to become
familiar with our products may make it more difficult to introduce those products to the market
• Our OEM partners may develop, market, and distribute their own products and market and distribute
products of our competitors, which could reduce our sales
If we fail to manage our sales and distribution channels successfully, these channels may conflict with one
another or otherwise fail to perform as we anticipate, which could reduce our sales and increase our expenses as
well as weaken our competitive position. Some of our distribution partners have experienced financial difficulties
in the past, and if our partners suffer financial difficulties in the future because of general economic conditions or
for other reasons, these partners may delay paying their obligations to us and we may have reduced sales or
increased bad debt expense that could adversely affect our operating results. In addition, reliance on multiple
channels subjects us to events that could cause unpredictability in demand, which could increase the risk that we
may be unable to plan effectively for the future, and could result in adverse operating results in future periods.
We are currently planning and designing information systems enhancements, and problems with the design
or implementation of these enhancements could interfere with our business and operations.
We are currently in the process of significantly enhancing our information systems, including planning and
designing a new enterprise resource planning system. The implementation of significant enhancements to
information systems is frequently disruptive to the underlying business of an enterprise, which may especially be
the case for us due to the size and complexity of our businesses. Any disruptions relating to our systems
enhancements, particularly any disruptions impacting our operations during the design or implementation
periods, could adversely affect our ability to process customer orders, ship products, provide services and support
to our customers, bill and track our customers, fulfill contractual obligations, and otherwise run our business.
Even if we do not encounter these adverse effects, the planning, designing and implementation may be much
more costly than we anticipated. If we are unable to successfully plan, design or implement the information
systems enhancements as planned, our financial position, results of operations, and cash flows could be
negatively impacted.
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