Adobe 2009 Annual Report Download - page 39

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provisions under various license arrangements and service agreements. In addition, we may incur significant costs in
acquiring the necessary third-party intellectual property rights for use in our products. Any of these could seriously harm our
business.
We may not be able to protect our intellectual property rights, including our source code, from third-party infringers, or
unauthorized copying, use or disclosure.
Although we defend our intellectual property rights and combat unlicensed copying and use of software and intellectual
property rights through a variety of techniques, preventing unauthorized use or infringement of our rights is inherently
difficult. We actively pursue software pirates as part of our enforcement of our intellectual property rights, but we
nonetheless lose significant revenue due to illegal use of our software. If piracy activities increase, it may further harm our
business.
Additionally, we take significant measures to protect the secrecy of our confidential information and trade secrets,
including our source code. If unauthorized disclosure of our source code occurs, we could potentially lose future trade secret
protection for that source code. The loss of future trade secret protection could make it easier for third-parties to compete
with our products by copying functionality, which could adversely affect our revenue and operating margins. We also seek to
protect our confidential information and trade secrets through the use of non-disclosure agreements with our customers,
contractors, vendors, and partners. However there is a risk that our confidential information and trade secrets may be
disclosed or published without our authorization, and in these situations it may be difficult and/or costly for us to enforce our
rights.
Security vulnerabilities in our products and systems could lead to reduced revenues or to liability claims.
Maintaining the security of computers and computer networks is a critical issue for us and our customers. Hackers
develop and deploy viruses, worms, and other malicious software programs that attack our products and systems. Although
this is an industry-wide problem that affects computers and products across all platforms, it affects our products in particular
because hackers tend to focus their efforts on the most popular operating systems and programs and we expect them to
continue to do so. Critical vulnerabilities have been identified in certain of our products. These vulnerabilities could cause the
application to crash and could potentially allow an attacker to take control of the affected system.
We devote significant resources to address security vulnerabilities through engineering more secure products,
enhancing security and reliability features in our products and systems, code hardening, deploying security updates to address
security vulnerabilities and improving our incident response time. The cost of these steps could reduce our operating margins.
Despite these efforts, actual or perceived security vulnerabilities in our products and systems may lead to claims against us
and harm our reputation, and could lead some customers to seek to return products, to stop using certain services, to reduce or
delay future purchases of products or services, or to use competing products or services. Customers may also increase their
expenditures on protecting their existing computer systems from attack, which could delay adoption of new technologies.
Any of these actions by customers could adversely affect our revenue.
Some of our businesses rely on us or third-party service providers to host and deliver services, and any interruptions or
delays in our service or service from these third parties, security or privacy breaches, or failures in data collection could
expose us to liability and harm our business and reputation.
Some of our businesses, including our Omniture business unit, rely on hosted services from us or third parties. Because
we hold large amounts of customer data and host certain of such data in third-party facilities, a security incident may
compromise the integrity or availability of customer data, or customer data may be exposed to unauthorized access.
Unauthorized access to customer data may be obtained through break-ins, breach of our secure network by an unauthorized
party, employee theft or misuse, or other misconduct. It is also possible that unauthorized access to customer data may be
obtained through inadequate use of security controls by customers. While strong password controls, IP restriction and
account controls are provided and supported, their use is controlled by the customer. For example, this could allow accounts
to be created with weak passwords, which could result in allowing an attacker to gain access to customer data. Additionally,
failure by customers to remove accounts of their own employees, or granting of accounts by the customer in an uncontrolled
manner, may allow for access by former or unauthorized customer employees. If there were ever an inadvertent disclosure of
personally identifiable information, or if a third party were to gain unauthorized access to the personally identifiable
information we possess, our operations could be disrupted, our reputation could be harmed and we could be subject to claims