Metro PCS 2010 Annual Report Download - page 58

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from various carriers. In addition, state regulators and local governments have imposed and may in the future
impose various surcharges, taxes and fees on our services. The applicability of these surcharges and fees to our
services is uncertain in many cases and jurisdictions may contest whether we have assessed and remitted those
monies correctly. Periodically state and federal regulators may increase or change the surcharges and fees we
currently pay. We remit all applicable federal, state and local fees, costs and expenses as required, but we do not
recover in all instances these regulatory and compliance fees, costs and expenses directly from our customers. If we
were to pass on these costs to our customers in the future, it may affect our ability to retain and attract new
customers. Because of fiscal budget deficits at many state and local jurisdictions, state and local municipalities may
increase taxes and regulatory fees on our services, which could have a material adverse effect on our business,
financial condition and operating results.
Concerns about whether wireless telephones pose health and safety risks may lead to the adoption of new
regulations or lawsuits that could decrease demand for our services.
Media reports and some studies have given rise to claims that radio frequency emissions from wireless handsets
may be linked to various health concerns, including cancer, or interfere with various electronic medical devices,
including air bags, hearing aids and pacemakers. Additional studies have been undertaken to determine whether the
claims based on these reports and studies are accurate. In addition, there have been claims made and lawsuits filed
that allege that the rechargeable batteries in phones may explode or catch on fire. Further lawsuits have also been
filed against various participants in the wireless industry alleging various adverse health consequences as a result of
wireless phone usage. While many of these lawsuits have been dismissed on various grounds, including a lack of
scientific evidence linking wireless handsets with such adverse health consequences, future lawsuits could be filed
based on new evidence or in different jurisdictions. If any lawsuits are filed against us, it could be costly to defend,
divert management’s attention from the business, and could subject us to substantial liability. If any such suits do
succeed, or if plaintiffs are successful in negotiating settlements, it is likely additional suits would follow. In
addition to health concerns, safety concerns have been raised with respect to the use of wireless handsets, including
texting, while driving. Certain states and municipalities in which we provide service or plan to provide service have
passed or proposed laws prohibiting or restricting the use of wireless phones while driving, prohibiting texting while
driving, limiting use of wireless devices while driving by persons under the age of 18, or requiring the use of
wireless headsets, and other states and municipalities may do so in the future.
If consumers’ health concerns over radio frequency emissions increase or safety concerns increase, consumers
may be discouraged from using wireless handsets or services, regulators may impose restrictions or increased
requirements on the location and operation of cell sites, the use or design of wireless telephones, may restrict the use
of wireless handsets while driving, may require that all wireless telephones include an earpiece that would enable
the use of wireless telephones without holding them against the user’s head and may give rise to additional lawsuits.
Such legislation or regulation could increase the cost of our wireless handsets, reduce demand for our products and
services, increase other operating expenses, or could expose wireless providers to further litigation, including
litigation relating to accidents, deaths or serious bodily injury allegedly incurred as a result of wireless telephone
use, which, even if not successful, may be costly to defend and could divert management’s attention from our
business, and could subject us to significant liability. In addition, compliance with such new requirements, and the
associated costs, could adversely affect our business. The actual or perceived risk of radio frequency emissions
could adversely affect us through a reduction in customers or a reduction in the availability of financing in the
future. If any of these risks occur, it could have a material adverse effect on our business, financial condition and
operating results.
System failures, security breaches and the unauthorized use of or interference with our network could cause
delays or interruptions of service, increase our cost of operations, and result in harm to our business
reputation, which could cause us to lose customers.
To be successful, we must provide our customers reliable, trustworthy service. We rely upon our networks and the
networks of other providers to provide and support all of our services. Some of the risks to our networks and
infrastructure, which may prevent us from providing reliable service, include:
• physical damage to outside plant facilities;
• power surges or outages;
• equipment failure;