Yahoo 2014 Annual Report Download - page 32

Certain of our metrics are subject to inherent challenges in measurement, and real or perceived
inaccuracies in such metrics may harm our reputation and negatively affect our business.
We present key metrics such as unique users, number of Ads Sold, number of Paid Clicks, Search
click-driven revenue, Price-per-Click and Price-per-Ad that are calculated using internal company
data. We periodically review, refine and update our methodologies for monitoring, gathering, and
calculating these metrics.
While our metrics are based on what we believe to be reasonable measurements and methodologies,
there are inherent challenges in deriving our metrics across large online and mobile populations
around the world. In addition, our user metrics may differ from estimates published by third parties or
from similar metrics of our competitors due to differences in methodology.
If advertisers or publishers do not perceive our metrics to be accurate, or if we discover material
inaccuracies in our metrics, it could negatively affect our reputation, business and financial results.
Any failure to scale and adapt our existing technology architecture to manage expansion of user-
facing services and to respond to rapid technological change could adversely affect our business.
As some of the most visited sites on the Internet, Yahoo Properties deliver a significant number of
products, services, page views, and advertising impressions to users around the world. We expect
our products and services to continue to expand and change significantly and rapidly in the future to
accommodate new technologies, new devices, new Internet advertising solutions, and new means of
content delivery.
In addition, widespread adoption of new Internet, networking or telecommunications technologies, or
other technological or platform changes, could require substantial expenditures to modify or adapt
our services or infrastructure. The technology architectures and platforms utilized for our services are
highly complex and may not provide satisfactory security features or support in the future, as usage
increases and products and services expand, change, and become more complex. In the future, we
may make additional changes to our existing, or move to completely new, architectures, platforms
and systems, such as the changes we have made in response to the increased use of mobile devices
such as tablets and smartphones. Such changes may be technologically challenging to develop and
implement, may take time to test and deploy, may cause us to incur substantial costs or data loss,
and may cause changes, delays or interruptions in service. These changes, delays, or interruptions in
our service may cause our users, Affiliates and other advertising platform participants to become
dissatisfied with our service or to move to competing providers or seek remedial actions or
compensation. Further, to the extent that demands for our services increase, we will need to expand
our infrastructure, including the capacity of our hardware servers and the sophistication of our
software. This expansion is likely to be expensive and complex and require additional technical
expertise. As we acquire users who rely upon us for a wide variety of services, it becomes more
technologically complex and costly to retrieve, store, and integrate data that will enable us to track
each user’s preferences. Any difficulties experienced in adapting our architectures, platforms and
infrastructure to accommodate increased traffic, to store user data, and track user preferences,
together with the associated costs and potential loss of traffic, could harm our operating results, cash
flows from operations, and financial condition.
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