Equifax 2007 Annual Report Download - page 21

EQUIFAX | 2007 ANNUAL REPORT 19
serve consumers directly. Our revenue stream is highly diversifi ed
with our largest customer providing less than 3% of total revenue.
The following table outlines the various end-users we serve:
Percentage of Consolidated Revenue
Financial 32%
Mortgage 12%
Consumer 10%
Commercial 8%
Retail 7%
Automotive 7%
Human Resources 5%
Telecommunications 5%
Other (1) 14%
100%
(1) Other includes revenues from government, marketing services, insurance and
healthcare end-users.
We market our products and services primarily through our
own direct sales organization that is organized around sales teams
that focus on customer segments typically aligned by vertical
markets and geography. Sales groups are based in our headquarters
and in fi eld offi ces located in the U.S. and in markets outside the
U.S. We also market our products and services through indirect
channels, including alliance partners, joint ventures and other
resellers. In addition, we sell through direct mail and various
websites, such as www.equifax.com.
Our largest geographic market segments are North America
(the U.S., Canada, Costa Rica); Europe (the U.K., the Republic
of Ireland, Spain and Portugal); and Latin America (Argentina,
Brazil, Chile, El Salvador, Honduras, Peru and Uruguay).
Revenue from international customers, including end-users
and resellers, amounted to 27%, 28% and 27% of our total revenue
in 2007, 2006 and 2005, respectively.
TECHNOLOGY AND INTELLECTUAL PROPERTY
We generally seek protection under federal, state and foreign laws
for strategic or fi nancially important intellectual property developed
in connection with our business. Certain intellectual property,
where appropriate, is protected by registration under applicable
trademark laws or by prosecution of patent applications. We own
several patents registered in the U.S. and certain foreign countries.
We also have certain registered trademarks in the U.S. and in many
foreign countries. The most important of these are “Equifax,”
“TALX” and many variations thereof. These trademarks are
used in connection with most of our product lines and services.
Although these patents and trademarks are important and valuable
assets in the aggregate, no single patent, group of patents or
trademark, other than our Equifax trademark, is critical to the
success of our business.
We license other companies to use certain data, technology
and other intellectual property rights we own or control, primarily
as core components of our products and services, on terms that
are consistent with customary industry standards and that are
designed to protect our interest in our intellectual property. An
example of this type of arrangement is our contract to exclusively
manage the SBFE database from 2007 until 2012.
We are licensed by others to use certain data, technology
and other intellectual property rights they own or control, none
of which is material to our business except for licenses from
(1) Fair Isaac Corporation, relating to certain credit-scoring
algorithms and the right to sell credit scores derived from them,
which licenses have varying durations and generally provide
for usage-based fees; and (2) Seisint, Inc., relating to a software
platform which facilitates sales by our DMS and CMS units. These
licenses have ten-year terms that began in 2002 and may be
renewed on an annual basis thereafter. We do not hold any
franchises or concessions that are material to our business or
results of operations.
INFORMATION SECURITY AND
GOVERNMENT REGULATION
Safeguarding the privacy and security of consumer credit
information, whether delivered online or in an offl ine format, is
a top priority. We recognize the importance of secure online
transactions and we maintain physical, administrative, and technical
safeguards to protect personal and business identifi able information.
We have security protocols and measures in place to protect
information from unauthorized access or alteration. These measures
include internal and external fi rewalls, physical security and
technological security measures, and encryption of certain data.
Our databases are regularly updated by information provided
by fi nancial institutions, telecommunications companies, other
trade credit providers, public records vendors and governments.
Various laws and regulations govern the collection and use of
this information. These laws and regulations impact how we are
able to provide information to our customers and have signifi cantly
increased our compliance costs. We are subject to differing laws
and regulations depending on where we operate.
U.S. Data and Privacy Protection
Our U.S. operations are subject to various federal and state laws
and regulations governing the collection, protection and use of
consumer credit and other information, and imposing sanctions
for the misuse of such information or unauthorized access to data.
Many of these provisions also affect our customers’ use of
consumer credit or other data we furnish. The information
underlying our North America Commercial Services and Direct
Marketing Services businesses is less regulated than the other
portions of our business. A signifi cant portion of the information
maintained by our Direct Marketing Services business is
voluntarily provided by individuals, thus this information
is subject to fewer restrictions on use.
These laws and regulations that may be applied to portions
of our business include, but are not limited to, the following:
• The Fair Credit Reporting Act, or FCRA, which governs
among other things the reporting of information to credit
reporting agencies that engage in the practice of assembling
or evaluating certain information relating to consumers,
including Equifax’s credit reporting business; making
prescreened offers of credit; the sharing of consumer report
information among affi liated and unaffi liated third parties;
access to credit scores; and requirements for data furnishers