Tiscali 2012 Annual Report Download - page 13

Annual financial report as at 31 December 2012

Date File Name Status Page
-
Annual Report as at 31
December 2012 13

The Group offers its products to consumer and business customers on the Italian Market, mainly via
five business lines:
(i) “Access”, in Broadband modes (LLU, Bitstream), inclusive of VoIP and mobile telephone services
(so-called MVNO);
(ii) Narrowband;
(iii) “Voice”, inclusive of traditional telephone traffic services (CS and CPS) and Wholesale;
(iv) Business services (so-called B2B), which include VPN, Hosting, domain connection and leased
line services, provided to companies and, lastly,
(v) Media and value added services, which include media, advertising and other services.
Main risks and uncertainties to which Tiscali S.p.A. and the Group are exposed
Risks relating to the general economic situation
The Group’s economic, equity and financial position is affected by several factors which constitute the
macro-economic scenario – such as, for example, variations in GDP (Gross Domestic Product),
investor confidence in the economic system and interest rate trends. The progressive weakening of
the economic system, together with a reduction in household disposable income, has cut the general
level of consumption, with a depressive impact on the capacity for a quick recovery.
The activities, strategies and prospects of the Tiscali Group are influenced by this state of play, and as
a result this also affects the economic, equity and financial position.
Risks connected with the performance of the telecommunications market
The telecommunications market the Tiscali Group operates in is extremely competitive in terms of
innovation, price, efficiency and user support. Tiscali competes with other groups at international level
and with various local operators.
The success of the Group’s activities depends on the capacity to maintain and increase shares of the
market in which it currently operates through high quality, innovative services that guarantee adequate
levels of profitability. If the Group is unable to maintain its competitive position with respect to the main
competitors in terms of price and quality and other elements, the Tiscali Group’s market shares could
fall, with a negative impact on the economic and financial results of the Group.
Risks connected with the dependence on technology of the telecommunications sector
The Group, which operates in a highly complex market from a technological point of view, is exposed
to a high risk regarding IT and ICT systems. As regards the management of the risks connected with
the damage to and malfunctioning of said systems, on which the business management is based, the
Group invests adequate resources aimed at protecting all IT tools and processes. The core business
systems are all highly reliable; the data centre in the Cagliari headquarters is equipped with safety
systems such as fire prevention and anti-flood systems, while the copies of data back-ups made by
operational personnel are kept in a different location from the CED (data processing centre)
guaranteeing a high level of reliability
The security system document is drawn up on an annual basis defining the safety measures
(technical, IT, organisational, logistical and procedural tools) aimed at reducing the risks of destruction
or loss, even accidental, of this data, and of unauthorised access or handling of the same.