Metro PCS 2010 Annual Report Download - page 54

44
Additionally, as more of our competitors use third party dealers to market and sell their products and services,
competition for dealers is intense and larger competitors are able to offer higher commissions and other benefits. As
a result, we may have difficulty attracting and retaining dealers and any inability to do so could have an adverse
effect on our ability to attract and retain customers, which could have a material adverse effect on our business,
financial condition and operating results.
We and our indirect dealers face direct competition with some of our other indirect distribution agents and
dealers.
Many of our indirect distribution outlets, primarily local dealers, are not our exclusive dealers, which means that
these dealers may sell other third party products and services in direct competition with us and other indirect dealers
in the same location. Additionally, we strive to ensure that our customers have access to a wide variety of products
and services within their geographic area, which means some of our dealers may be located within close proximity
to one another and compete for the same customer base. As a result of the direct competition we encounter in some
of our dealer locations and the potential for competition among our local dealers, we may experience reduced sales
in certain geographic areas, which could have a material adverse effect on our business, financial condition and
operating results.
Our agreements with our indirect distribution agents may be terminated on relatively short notice.
We have agreements with our third party indirect distribution agents to market and sell our products and services.
These agreements can be terminated by us or by such indirect distribution agents on relatively short notice. Our
competitors are focused on increasing their distribution, and the relatively short termination period may allow our
competitors to move our indirect distribution agents to their products and services. In addition, if the economy
deteriorates or does not further improve, some of these indirect distribution agents may cease to operate. If we lose
our indirect distribution, we may have difficulty finding new companies to distribute our products and services, or
we may be forced to increase the amount of payments we make to our indirect distribution agents. If any of these
occur, it could have a material adverse effect on our business, financial condition and operational results.
We utilize a limited number of cell site and DAS providers.
We currently use, and plan to continue to use, DAS systems in lieu of traditional cell sites to provide service to
certain critical portions of certain metropolitan areas. In order to construct DAS systems, the DAS provider will be
required to obtain necessary authority from the relevant state and local regulatory authorities and to secure certain
agreements, such as right of way agreements, in order to construct or operate the DAS systems. In addition, the DAS
system provider may be required to construct a transport network as part of their construction of the DAS systems.
These DAS systems may be leased and/or licensed from third party suppliers. We utilize a limited number of DAS
system providers. Some of the DAS system providers we are using have not previously constructed or been
authorized to construct DAS systems in certain of the areas we plan to build DAS systems so there may be
unforeseen obstacles and delays in constructing the DAS systems in those areas. DAS systems also pose particular
compliance challenges with regard to any regulatory requirements that may be adopted by the FCC, such as back up
power requirements, and may be susceptible to certain weather conditions, such as flooding or power outages. If any
of these risks occur, it could have a material adverse effect on our ability to comply with applicable laws, could
require us to spend significant amounts of additional capital, could delay or affect our ability to offer our services,
and could have a material adverse effect on our business, financial condition and operating results.
If our master agreement with one of our cell site or DAS providers were to terminate, or if the cell site or DAS
system providers were to experience severe financial difficulties or file for bankruptcy, or if one of these cell site or
DAS system providers were unable to support our use of its cell sites or DAS systems, we would have to find new
sites or rebuild the affected portion of our network. In addition, the concentration of our cell site leases and DAS
systems with a limited number of cell site and DAS system providers could adversely affect our business, financial
condition and operating results if we are unable to renew our expiring leases or DAS system agreements with these
companies either on terms comparable to those we have today or at all. In addition, the tower industry has
continued to consolidate. If any of the companies from which we lease towers or DAS systems were to consolidate
with other cell site or DAS systems companies, they may be unable to honor obligations to us or have the ability to
raise prices, which could materially affect our profitability. If a material number of cell sites or DAS systems were
no longer available for our use, it could have a material adverse effect on our business, financial condition and
operating results.