Support.com 2006 Annual Report Download - page 27

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• patents issued to us may not be broad enough to protect our proprietary rights; and
• our issued patents could be successfully challenged.
We rely upon patents, trademarks, copyrights and trade secrets to protect our proprietary rights and if these rights are not
sufficiently protected, it could harm our ability to compete and to generate revenue.
We rely on a combination of laws, such as patents, copyright, trademark and trade secret laws, and contractual restrictions, such as
confidentiality agreements and licenses, to establish and protect our proprietary rights. Our ability to compete and grow our business
could suffer if these rights are not adequately protected. Our proprietary rights may not be adequately protected because:
• laws and contractual restrictions may not adequately prevent misappropriation of our technologies or deter others from
developing similar technologies; and
• policing unauthorized use of our products and trademarks is difficult, expensive and time−consuming, and we may be unable to
determine the existence or extent of this unauthorized use.
Also, the laws of other countries in which we market our products may offer little or no protection of our proprietary technologies.
Reverse engineering, unauthorized copying or other misappropriation of our proprietary technologies could enable third parties to
benefit from our technologies without paying us for them, which would harm our competitive position and market share.
We may face intellectual property infringement claims that could be costly to defend and result in our loss of significant rights.
Other parties may assert intellectual property infringement claims against us or our customers and our products may infringe the
intellectual property rights of third parties. For example, our products may infringe issued patents that may relate to our products. In
addition, as is increasingly common in the software industry, we may be confronted with the aggressive enforcement of patents by
companies whose primary business activity is to acquire patents for the purpose of offensively asserting them against other companies.
Intellectual property litigation is expensive and time−consuming and could divert management’s attention from our business. If there
is a successful claim of infringement, we may be required to develop non−infringing technology or enter into royalty or license
agreements, which may not be available on acceptable terms, if at all. Our failure to develop non−infringing technologies or license
proprietary rights on a timely basis would harm our business.
If the growth of demand for digital services does not continue, our ability to increase our revenue could suffer.
Our ability to increase our revenue will depend in part on increased demand for digital services. If this demand does not grow as
rapidly or to the extent we anticipate, our business could suffer. The growth of digital services is uncertain and will depend in
particular upon the availability, at a reasonable price, of such digital services, the building of infrastructure to support such services,
the availability of competitive products, and the reliability of such services.
We may experience a decrease in market demand due to uncertain economic conditions in the United States and in
international markets, which has been further exacerbated by the concerns of terrorism, war and social and political
instability.
The United States and international economies have in the past experienced periods of slow economic growth and this could occur
again. In addition, terrorist attacks in the United States and turmoil in certain overseas regions have increased uncertainty and
may exacerbate a decline in economic conditions, both domestically and internationally. If the economy declines as a result of
economic, political and social turmoil, or if there are further terrorist attacks in the United States or elsewhere, we may experience
decreases in the demand for our products and services, which would harm our operating results.
23
Source: SUPPORTSOFT INC, 10−K, March 16, 2007