Yahoo 2010 Annual Report Download - page 25

problems we may encounter in developing versions of our services for use on those devices, and we may need to
devote significant resources to the creation, support, and maintenance of such versions or risk loss of market
share. If we are unable to attract and retain a substantial number of alternative device manufacturers, distributors,
content providers, and users to our services, or to capture a sufficient share of an increasingly important portion
of the market for these services, we may be unsuccessful in attracting both advertisers and premium service
subscribers to these services.
To the extent that an access provider or device manufacturer enters into a distribution arrangement with one of
our competitors (or as our competitors design mobile devices and mobile device operating systems), we face an
increased risk that our users will favor the services or properties of that competitor. The manufacturer or access
provider might promote a competitor’s services or might impair users’ access to our services by blocking access
through their devices or by not making our services available in a readily-discoverable manner on their devices.
If competitive distributors impair access to our services, or if they simply are more successful than our
distributors in developing compelling products that attract and retain users or advertisers, then our revenue could
decline.
In the future, as new methods for accessing the Internet and our services become available, including through
alternative devices, we may need to enter into amended distribution agreements with existing access providers,
distributors and manufacturers to cover the new devices and new arrangements. We face a risk that existing and
potential new access providers, distributors, and manufacturers may decide not to offer distribution of our
services on reasonable terms, or at all. If we fail to obtain distribution or to obtain distribution on terms that are
reasonable, we may not be able to fully execute our business plan.
Our international operations are subject to increased risks which could harm our business, operating results,
and financial condition.
In addition to uncertainty about our ability to continue to generate revenue from our foreign operations and
expand our international market position, there are risks inherent in doing business internationally, including:
• trade barriers and changes in trade regulations;
• difficulties in developing, staffing, and simultaneously managing a large number of varying foreign operations
as a result of distance, language, and cultural differences;
• stringent local labor laws and regulations;
• longer payment cycles;
• credit risk and higher levels of payment fraud;
• profit repatriation restrictions, and foreign currency exchange restrictions;
• political or social unrest, economic instability, repression, or human rights issues;
• geopolitical events, including acts of war and terrorism;
• import or export regulations;
• compliance with U.S. laws such as the Foreign Corrupt Practices Act, and local laws prohibiting corrupt
payments to government officials;
• seasonal volatility in business activity and local economic conditions;
• laws and business practices that favor local competitors or prohibit foreign ownership of certain businesses;
• different or more stringent user protection, content, data protection, privacy and other laws; and
• risks related to other government regulation or required compliance with local laws.
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