TeleNav 2010 Annual Report Download - page 26

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able to compete effectively with existing market participants and may not be able to realize a positive return on
the investment we have made in these products or services. If our introduction of a new product or service is not
successful or we are not able to achieve the revenue or margins we expect, our operating results may be harmed
and we may not recover our product development and marketing expenditures.
We may not be able to enhance our LBS to keep pace with technological and market developments, or develop
new LBS in a timely manner or at competitive prices.
The market for LBS is emerging and is characterized by rapid technological change, evolving industry
standards, frequent new product introductions and short product life cycles. To keep pace with technological
developments, satisfy increasing customer requirements and achieve product acceptance, our future success
depends upon our ability to enhance our current LBS platform and to continue to develop and introduce new LBS
offerings and enhanced performance features and functionality on a timely basis at competitive prices. Our
inability, for technological or other reasons, to enhance, develop, introduce or deliver compelling LBS in a timely
manner, or at all, in response to changing market conditions, technologies or consumer expectations could have a
material adverse effect on our operating results or could result in our LBS becoming obsolete. Our ability to
compete successfully will depend in large measure on our ability to maintain a technically skilled development
and engineering team and to adapt to technological changes and advances in the industry, including providing for
the continued compatibility of our LBS platform with evolving industry standards and protocols and competitive
network operating environments.
Development and delivery schedules for LBS are difficult to predict. We have in the past and may in the
future fail to deliver new versions of our services in a timely fashion. If new releases of our LBS are delayed or
our services are not preloaded on mobile phones upon their initial commercial release, our wireless carrier
partners may curtail their efforts to market and promote our LBS and end users may switch to competing
services, any of which would result in a delay or loss of revenue and could harm our business. In addition, we
cannot assure you that the technologies and related LBS that we develop will be brought to market by our
wireless carrier partners as quickly as anticipated or that they will achieve broad acceptance among wireless
carriers or consumers.
We rely on third party data and content to provide our services and if we were unable to obtain content at
reasonable prices, or at all, our gross margins and our ability to provide our services would be harmed.
We rely on third party data and content to provide our services including map data, POI, traffic information,
gas prices and weather information. If our suppliers of this data or content were to enter into exclusive
relationships with other providers of LBS or were to discontinue providing such information and we were unable
to replace them cost effectively, or at all, our ability to provide our services would be harmed. Our gross margins
may also be affected if the cost of third party data and content increases substantially.
We obtain map data from Tele Atlas and NAVTEQ, which are companies owned by our current and
potential competitors TomTom and Nokia, respectively. Accordingly, these third party data and content
providers may act in a manner that is not in our best interest. For example, they may cease to offer their map data
to us.
We may not be able to upgrade our LBS platform to support certain advanced features and functionality
without obtaining technology licenses from third parties. Obtaining these licenses may be costly and may delay
the introduction of such features and functionality, and these licenses may not be available on commercially
favorable terms, or at all. The inability to offer advanced features or functionality, or a delay in our ability to
upgrade our LBS platform, may adversely affect consumer demand for our LBS and, consequently, harm our
business.
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