Metro PCS 2008 Annual Report Download - page 44

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services, or if we are unable to transition our billing services to Amdocs in a timely manner, we may not be able to
bill our customers, provide customer care, grow our business, report financial results, or manage our business and
we may have increased churn, all of which could have a material and adverse effect on our business, financial
condition and operating results.
We and our suppliers may be subject to claims of infringement.
The technologies used in the telecommunications industry are protected by a wide array of patents and other
intellectual property rights. As a result, third parties may assert infringement claims against us or our suppliers from
time to time based on our or their general business operations, the equipment, software or services we or they use or
provide, or the specific operation of our wireless networks or service. Our suppliers may be subject to infringement
claims that if proven could preclude the supplier from supplying us with the products and services we require to run
our business or offer our services, require the supplier to change the products and services they provide to us in a
way which could have a material adverse effect on us, or cause the supplier to increase the charges for their products
and services to us. We cannot guarantee that we will be fully protected against all losses associated with an
infringement claim involving our manufacturers, licensors and suppliers who provide us with the equipment,
software and technology that we use in our business. In addition, our suppliers may be unable to pay any damages or
honor their indemnification obligations to us, which may result in us having to bear such losses. We may also have
to buy equipment and services from other third party suppliers or pay royalties to the holders of intellectual property
rights.
Moreover, we may be subject to claims that products, software and services provided by different vendors which
we combine with products or with services provided by other vendors or with our own services in order to offer
services to our customers are infringing on the rights of others, and we may not have any indemnification protection
from our vendors for these claims. Further, we have been, and in the future may be, subject to claims that certain
business processes we use, services we provide, or products we create may infringe on the rights of third parties, and
we may have no indemnification rights from any of our vendors or suppliers. Whether or not an infringement claim
is valid or successful, it could adversely affect our business by diverting management’s attention, involving us in
costly and time-consuming litigation, requiring us to enter into royalty or licensing agreements (which may not be
available on acceptable terms, or at all), requiring us to pay royalties for prior periods, requiring us or our suppliers
to redesign our or their business operation, processes, systems, services or products to avoid claims of infringement,
or requiring us to purchase products and services from different vendors or not sell certain products or services. If a
claim is found to be valid or if we or our suppliers cannot successfully negotiate a required royalty or license
agreement, we could be forced to pay substantial damages, including potentially treble damages, we could be subject
to an injunction that could disrupt our business, prevent us from offering some or all of our products or services and
cause us to incur losses of customers or revenues, any or all of which could be material and could adversely affect
our business, financial condition and operating results.
Substantially all of our network infrastructure equipment is manufactured or provided by a single
infrastructure vendor.
Substantially all of our PCS and AWS network infrastructure equipment is manufactured or provided by Alcatel
Lucent, formerly known as Lucent Technologies, Inc. We have entered into an agreement with Alcatel Lucent to
provide us with PCS and AWS CDMA system products and services, including without limitation, wireless base
stations, switches, power, cable and transmission equipment and services The agreement does not cover any other
non-AWS or non-PCS spectrum we may acquire in the future, including our spectrum in the 700 MHz band or other
technologies, such as LTE. A substantial portion of the equipment manufactured or provided by Alcatel Lucent is
proprietary, which means that equipment and software from other manufacturers may not work with Alcatel
Lucent’s equipment and software, or may require the expenditure of additional capital, which may be material. The
communications equipment market has been subject to recent economic turmoil. If Alcatel Lucent ceases to
develop, or substantially delays development of, new products or ceases to support existing equipment and software,
or experiences problems which prevent Alcatel Lucent from performing its obligations under the agreement, we may
be required to spend significant amounts of money to replace such equipment and software, may not be able to offer
new products or services, and may not be able to compete effectively in our markets. If we fail to continue
purchasing our PCS and AWS CDMA products exclusively from Alcatel Lucent, we may have to pay certain
liquidated damages based on the difference in prices between exclusive and non-exclusive prices, which would have
a material adverse effect on our business, financial condition and operating results.