Virgin Media 2006 Annual Report Download - page 31

Research and Development
Our research and development activities involve the analysis of technological developments affecting our cable television,
telephone and telecommunications business, the evaluation of existing services and sales and marketing techniques and the
development of new services and techniques.
Patents, Trademarks, Copyrights and Licenses
We do not have any material patents or copyrights nor do we believe that patents play a material role in our business. We own
and have the right to use registered trademarks, which in some cases are, and in others may be, of material importance to our business,
including the exclusive right to use the “Virgin” name and logo in connection with our corporate activities and in connection with the
activities of our consumer and a large part of our content businesses under license from Virgin Enterprises Limited. This license with
Virgin Enterprises Limited is for a 30−year term and exclusive to us within the U.K. and Ireland. The license entitles us to use the
“Virgin’’ name for the TV, broadband internet, telephone and mobile phone services we provide to our residential customers, as well
as the acquisition and branding of sports, movies and other premium television content and the sale of certain communications
equipment, such as set top boxes and cable modems. For our content operations, we have agreed in principle to extend the license to
entitle us to use the “Virgin Media Television’’ name for the creation, distribution and management of our wholly−owned television
channels, and to provide certain complimentary services to our residential customers. The agreement (and the proposed extension)
provides for an annual royalty of 0.25% of certain consumer and content revenues, subject to a minimum annual royalty of £8.7
million. As part of the agreement, we have the right to adopt, and have adopted, a company name for our parent, Virgin Media Inc.,
which together with the name “Virgin Media”, we retain worldwide exclusivity.
Employees
As of December 31, 2006, we had 17,034 employees, of whom 15,669 were permanent, and 1,365 were temporary or contract.
Approximately 1,900 Service Operations, Network Operations, Design & Civils and Business Field Operations employees are covered
by two collective bargaining agreements with the Communication Workers Union, or CWU, and the Broadcasting, Entertainment,
Cinematograph and Theatre Union, or BECTU. Both of these agreements are terminable by either the Union or us with three months’
written notice. Except for these two arrangements, no other employees are covered by collective bargaining agreements. We believe
that our relationship with the CWU, BECTU and our employees is generally good.
Item 1A. Risk Factors
Our business, financial condition or results of operations could be materially adversely affected by any of the risks and
uncertainties described below. Additional risks not presently known to us, or that we currently deem immaterial, may also impair our
business.
Risks Relating to Our Business and Industry
We are subject to significant competition and we expect that competition will intensify.
The level of competition is intense in each of the markets in which we compete, and we expect competition to increase. In
particular, our fixed and mobile telephone, broadband and cable television businesses compete with British Telecommunications Plc,
or BT, in telephone and broadband services; Vodafone, O2, Orange and others in mobile telephone services; and British Sky
Broadcasting Group Plc, or BSkyB, in multi channel television, telephone and broadband services, each of whom has significant
operational scale, resources and national distribution capacity. We also compete with numerous internet service providers and indirect
telephone access operators that offer telephone, broadband and dial−up internet services over BT’s network. We will face increasing
competition from mobile telephone network providers and new market entrants, including those providing VoIP and IPTV. The
increase in
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Source: VIRGIN MEDIA INVESTM, 10−K, March 01, 2007