Virgin Media 2007 Annual Report Download - page 35

The sectors in which we compete are subject to rapid and significant changes in technology, and the effect of
technological changes on our businesses cannot be predicted.
The broadband internet, television, fixed line telephone and mobile telephone services sectors are
characterized by rapid and significant changes in technology. The effect of future technological changes
on our business cannot be predicted. It is possible that products or other technological breakthroughs,
such as VoIP (over fixed and mobile technologies), mobile instant messaging, wireless fidelity, or WiFi,
WiMax (i.e., the extension of local WiFi networks across greater distances) or internet protocol
television, may result in our core offerings becoming less competitive and render our existing products
and services obsolete. We may not be able to develop new products and services at the same rate as
competitors or keep up with trends in the technology market as well as our competitors.
The cost of implementing emerging and future technologies could be significant, and our ability to
fund that implementation may depend on our ability to obtain additional financing.
We depend on equipment and service suppliers that may discontinue their products or seek to charge us prices
that are not competitive, either of which may adversely affect our business and profitability.
We have important relationships with several suppliers of customer equipment, hardware, software
and services that we use to operate our network and systems and transmit our services. We also
outsource various customer services. In many cases, we have made substantial investments in the
equipment or software of a particular supplier, making it difficult for us in the short-term to change
supply and maintenance relationships in the event that our initial supplier refuses to offer us favorable
prices or ceases to produce equipment or provide the support that our network and systems require. If
equipment or service suppliers were to discontinue their products or seek to charge us prices that are
not competitive, our business and profitability could be materially adversely affected.
Furthermore, we rely upon outside contractors to install our equipment in customers’ homes.
Delays caused by these contractors, or quality issues concerning these contractors, could cause our
customers to become dissatisfied and could produce additional churn or discourage potential new
customers.
The integration of our billing systems may have an adverse effect on our customer service, customer
acquisitions, customer churn rate and operating costs.
As a result of our growth through acquisitions, we inherited numerous billing and customer service
systems. We continue to migrate our consumer cable and business customers to one central billing
system. If we are not successful with this process, we might not be able to achieve the expected cost
savings and customer service improvements associated with the new system. It is possible that billing
errors and other customer service disruptions could occur during further integration processes,
potentially resulting in increased customer churn or adverse effects on customer service, customer
acquisitions, collections, customer numbers and the costs of maintaining our billing systems going
forward.
Acquisitions and other strategic transactions present many risks, and we may not realize the financial and
strategic goals that were contemplated at the time of any transaction.
From time to time we have made acquisitions, dispositions and have entered into other strategic
transactions. In connection with such transactions, we may incur unanticipated expenses, fail to realize
anticipated benefits, have difficulty integrating the acquired businesses, disrupt relationships with
current and new employees, customers and suppliers, incur significant indebtedness, or have to delay or
not proceed with announced transactions. These factors could harm our business and our reputation.
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