AT&T Wireless 2011 Annual Report Download - page 58

Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)
Dollars in millions except per share amounts
56 AT&T Inc.
 •Ourabilitytodevelopattractiveandprofitableproduct/
service offerings to offset increasing competition in our
wireless and wireline markets.
 •Theabilityofourcompetitorstoofferproduct/service
offerings at lower prices due to lower cost structures and
regulatory and legislative actions adverse to us, including
state regulatory proceedings relating to unbundled
network elements and nonregulation of comparable
alternative technologies (e.g., VoIP).
 •ThedevelopmentofattractiveandprofitableU-verse
service offerings; the extent to which regulatory, franchise
fees and build-out requirements apply to this initiative;
and the availability, cost and/or reliability of the various
technologies and/or content required to provide such
offerings.
 •Ourcontinuedabilitytoattractandofferadiverse
portfolio of wireless devices, some on an exclusive basis.
 •Theavailabilityandcostofadditionalwirelessspectrum
and regulations and conditions relating to spectrum use,
licensing and technical standards and deployment and
usage, including network management rules.
 •Ourabilitytomanagegrowthinwirelessdataservices,
including network quality and acquisition of adequate
spectrum at reasonable costs and terms.
 •Theoutcomeofpending,threatenedorpotential
litigation, including patent and product safety claims
by or against third parties.
 •Theimpactonournetworksandbusinessfrommajor
equipment failures; security breaches related to the
network or customer information; our inability to obtain
handsets, equipment/software or have handsets,
equipment/software serviced in a timely and cost-
effective manner from suppliers; or severe weather
conditions, natural disasters, pandemics, energy
shortages, wars or terrorist attacks.
 •TheissuancebytheFinancialAccountingStandards
Board or other accounting oversight bodies of new
accounting standards or changes to existing standards.
 •TheissuancebytheInternalRevenueServiceand/or
state tax authorities of new tax regulations or changes to
existing standards and actions by federal, state or local
tax agencies and judicial authorities with respect to
applying applicable tax laws and regulations and the
resolution of disputes with any taxing jurisdictions.
 •Ourabilitytoadequatelyfundourwirelessoperations,
including payment for additional spectrum network
upgrades and technological advancements.
 •Changesinourcorporatestrategies,suchaschanging
network requirements or acquisitions and dispositions,
which may require significant amounts of cash or stock,
to respond to competition and regulatory, legislative and
technological developments.
Readers are cautioned that other factors discussed in this
report, although not enumerated here, also could materially
affect our future earnings.
CAUTIONARY LANGUAGE CONCERNING
FORWARD-LOOKING STATEMENTS
Information set forth in this report contains forward-looking
statements that are subject to risks and uncertainties, and
actual results could differ materially. Many of these factors
are discussed in more detail in the “Risk Factors” section.
We claim the protection of the safe harbor for forward-looking
statements provided by the Private Securities Litigation
Reform Act of 1995.
The following factors could cause our future results to differ
materially from those expressed in the forward-looking
statements:
 •Adverseeconomicand/orcapitalaccesschangesinthe
markets served by us or in countries in which we have
significant investments, including the impact on customer
demand and our ability and our suppliers’ ability to
access financial markets at favorable rates.
 •Changesinavailabletechnologyandtheeffectsofsuch
changes, including product substitutions and deployment
costs.
 •Increasesinourbenefitplans’costs,includingincreases
due to adverse changes in the U.S. and foreign securities
markets, resulting in worse-than-assumed investment
returns and discount rates and adverse medical cost trends
and unfavorable healthcare legislation and regulations.
 •ThefinaloutcomeofFCCandotherfederalagency
proceedings and reopenings of such proceedings and
judicial reviews, if any, of such proceedings, including
issues relating to access charges, universal service,
broadband deployment, E911 services, competition,
net neutrality, unbundled loop and transport elements,
availability of new spectrum from the FCC on fair and
balanced terms, wireless license awards and renewals
and wireless services, including data roaming
agreements.
 •Thefinaloutcomeofregulatoryproceedingsinthestates
in which we operate and reopenings of such proceedings
and judicial reviews, if any, of such proceedings, including
proceedings relating to Interconnection terms, access
charges, universal service, unbundled network elements
and resale and wholesale rates; broadband deployment
including our U-verse services; net neutrality;
performance measurement plans; service standards;
and traffic compensation.
 •Enactmentofadditionalstate,federaland/orforeign
regulatory and tax laws and regulations pertaining to
our subsidiaries and foreign investments, including laws
and regulations that reduce our incentive to invest in
our networks, resulting in lower revenue growth and/or
higher operating costs.
 •Ourabilitytoabsorbrevenuelossescausedbyincreasing
competition, including offerings that use alternative
technologies (e.g., cable, wireless and VoIP) and our
ability to maintain capital expenditures.
 •Theextentofcompetitionandtheresultingpressureon
customer and access line totals and wireline and wireless
operating margins.