Google 2013 Annual Report Download - page 14

8 GOOGLE INC.
PART I
ITEM1A.RiskFactors
 Risk Factors
Ouroperationsandnancialresultsaresubjecttovariousrisksanduncertainties,includingthosedescribedbelow,whichcould
adverselyaectourbusiness,nancialcondition,resultsofoperations,cashows,andthetradingpriceofourcommonstock.
Risks Related to Our Business and Industry
We face intense competition. If we do not continue to innovate and provide products and services that are useful to
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Our business is rapidly evolving and intensely competitive, and is subject to changing technologies, shifting user needs, and
frequent introductions of new products and services. Our ability to compete successfully depends heavily on providing products
and services that make using the internet a more useful and enjoyable experience for our users and delivering innovative products
and technologies to the marketplace. As our business has evolved, the competitive pressure to innovate will now encompass a
wider range of products and services, including products and services that may be outside of our historical core business.
Wehavemanycompetitorsindierentindustries,includinggeneralpurposesearchengines,verticalsearchenginesand
e-commerce sites, social networking sites, traditional media companies, wireless mobile device companies, and providers of
online products and services. Our current and potential competitors range from large and established companies to emerging
start-ups. Established companies have longer operating histories and more established relationships with customers and users, and
theycanusetheirexperienceandresourcesinwaysthatcouldaectourcompetitiveposition,includingbymakingacquisitions,
investing aggressively in research and development, aggressively initiating intellectual property claims (whether or not meritorious)
and competing aggressively for advertisers and websites. Emerging start-ups may be able to innovate and provide products and
services faster than we can.
Our competitors are constantly developing innovations in web search, online advertising, wireless mobile devices, and web-based
products and services. The research and development of new, technologically advanced products is also a complex and uncertain
process requiring high levels of innovation and investment, as well as the accurate anticipation of technology, market trends and
consumerneeds.Asaresult,wemustcontinuetoinvestsignicantresourcesinresearchanddevelopment,includingthrough
acquisitions, in order to enhance our web search technology and our existing products and services, and introduce new products
andservicesthatpeoplecaneasilyandeectivelyuse.Ifweareunabletoprovidequalityproductsandservices,thenacceptance
ratesforourproductsandservicescoulddeclineandaectconsumerandadvertiserperceptionsofourbrand.Inaddition,these
newproductsandservicesmaypresentnewanddiculttechnologicalandlegalchallenges,andwemaybesubjecttoclaims
ifusersoftheseoeringsexperienceservicedisruptionsorfailuresorotherissues.Ouroperatingresultswouldalsosuerif
our innovations are not responsive to the needs of our users, advertisers, and Google Network Members, are not appropriately
timedwithmarketopportunities,orarenoteectivelybroughttomarket.Astechnologycontinuestodevelop,ourcompetitors
maybeabletooeruserexperiencesthatare,orthatareseentobe,substantiallysimilartoorbetterthanours.Thismayforce
ustocompeteindierentwaysandexpendsignicantresourcesinordertoremaincompetitive.Ifourcompetitorsaremore
successful than we are in developing compelling products or in attracting and retaining users, advertisers, and content providers,
ourrevenuesandoperatingresultscouldbeadverselyaected.
Our ongoing investment in new businesses and new products, services, and technologies is inherently risky, and could
disrupt our ongoing businesses.
We have invested and expect to continue to invest in new businesses, products, services, and technologies. Such endeavors may
involvesignicantrisksanduncertainties,includingdistractionofmanagementfromcurrentoperations,insucientrevenuesto
osetliabilitiesassumedandexpensesassociatedwiththesenewinvestments,inadequatereturnofcapitalonourinvestments,
andunidentiedissuesnotdiscoveredinourduediligenceofsuchstrategiesandoerings.Becausethesenewventuresare
inherentlyrisky,noassurancecanbegiventhatsuchstrategiesandoeringswillbesuccessfulandwillnotadverselyaectour
reputation,nancialcondition,andoperatingresults.
More people are using devices other than personal computers to access the internet and accessing new platforms to
make search queries. If manufacturers and users do not widely adopt versions of our web search technology, products,
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The number of people who access the internet through devices other than personal computers, including mobile phones,
smartphones, handheld computers such as netbooks and tablets, video game consoles, and television set-top devices, is
increasing dramatically. The lower resolution, functionality, and memory associated with some alternative devices make the
useofourproductsandservicesthroughsuchdevicesmoredicultandtheversionsofourproductsandservicesdeveloped
for these devices may not be compelling to users, manufacturers, or distributors of alternative devices. Each manufacturer or
distributor may establish unique technical standards for its devices, and our products and services may not work or be viewable
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