Zynga 2013 Annual Report Download - page 31

Table of Contents
Evolving regulations, industry standards and practices by platform providers concerning data privacy could prevent us from providing our
games to our players, or require us to modify our games, thereby harming our business.
The regulatory framework for privacy issues worldwide is currently in flux and is likely to remain so for the foreseeable future. Practices
regarding the collection, use, storage, transmission and security of personal information by companies operating over the Internet and mobile
platforms are under increased public scrutiny, and civil claims alleging liability for the breach of data privacy have been asserted against us. The
U.S. government, including the Federal Trade Commission, the Department of Commerce, U.S. Congress, and various State Attorneys General
are continuing to review the need for greater regulation for the collection of information concerning consumer behavior on the Internet, including
regulation aimed at restricting certain targeted advertising practices. There is also increased attention being given to the collection of data from
minors. For instance, the Children’s Online Privacy Protection Act requires companies to obtain parental consent before collecting personal
information from children under the age of 13. In addition, the European Union has proposed reforms to its existing data protection legal
framework, which may result in a greater compliance burden for companies with users in Europe. Various government and consumer agencies
have also called for new regulation and changes in industry practices.
We began operations in 2007 and have grown rapidly. While our administrative and technical systems have developed rapidly, during our
earlier history our practices relating to intellectual property, data privacy and security, and legal compliance may not have been as robust as they
are now, and there may be unasserted claims arising from this period that we are not able to anticipate. In addition, our business, including our
ability to operate and expand internationally, could be adversely affected if laws or regulations are adopted, interpreted, or implemented in a
manner that is inconsistent with our current business practices and that require changes to these practices, the design of our website, games,
features or our privacy policies. In particular, the success of our business has been, and we expect will continue to be, driven by our ability to
responsibly use the data that our players share with us. Therefore, our business could be harmed by any significant change to applicable laws,
regulations or industry practices or the requirements of platform providers regarding the use or disclosure of data our players choose to share
with us, age verification, underage players or the manner in which the express or implied consent of consumers for such use and disclosure is
obtained. Such changes may require us to modify our game features and advertising practices, possibly in a material manner, and may limit our
ability to use the data that our players share with us.
We process, store and use personal information and other data, which subjects us to governmental regulation and other legal obligations
related to privacy, and our actual or perceived failure to comply with such obligations could harm our business.
We receive, store and process personal information and other player data, and we enable our players to share their personal information
with each other and with third parties, including on the Internet and mobile platforms. There are numerous federal, state and local laws around
the world regarding privacy and the storing, sharing, use, processing, disclosure and protection of personal information and other player data on
the Internet and mobile platforms, the scope of which are changing, subject to differing interpretations, and may be inconsistent between
countries or conflict with other rules. We generally comply with industry standards and are subject to the terms of our own privacy policies and
privacy-related obligations to third parties (including voluntary third-party certification bodies such as TRUSTe). We strive to comply with all
applicable laws, policies, legal obligations and certain industry codes of conduct relating to privacy and data protection, to the extent reasonably
attainable. However, it is possible that these obligations may be interpreted and applied in a manner that is inconsistent from one jurisdiction to
another and may conflict with other rules or our practices. Any failure or perceived failure by us to comply with our privacy policies, our
privacy-related obligations to players or other third parties, or our privacy-related legal obligations, or any compromise of security that results in
the unauthorized release or transfer of personally identifiable information or other player data, may result in governmental enforcement actions,
litigation or public statements against us by consumer advocacy groups or others and could cause our players to lose trust in us, which could
have an adverse effect on our business. Additionally, if third parties we
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