Juno 2013 Annual Report Download - page 26

Table of Contents
these or other reasons, we have experienced and may continue to experience significant volatility in the market price of our common stock.
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We face intense competition that could result in the failure of our social networking services to be commercially successful.
As consumers continue to spend more time and money online, the competition for their time and engagement has continued to intensify.
Consumers have a great number of options for online content and entertainment, including, by way of example, games, websites offering news and
current events, movies, television shows, videos, information about any and virtually every topic, and the opportunity to communicate, socialize and
interact with acquaintances and others. Certain aspects of the value proposition of our social networking services compete with major social networking
platforms, such as Facebook, as well as Internet search engines such as Google. Many of our competitors offer their content and services free of charge.
The market for loyalty marketing services is highly competitive, and we expect competition to significantly increase in the future as loyalty
marketing programs continue to grow in popularity and expand to mobile platforms. Our MyPoints loyalty marketing service faces competition for
members from other loyalty marketing programs, such as Ebates, as well as offline loyalty marketing programs that have a significant online presence,
such as those operated by credit card, airline and hotel companies. In addition, we also face competition for members from online providers of
discounted offerings and coupons, such as Groupon and LivingSocial.
Some of our competitors have longer operating histories, greater name and brand recognition, larger user bases, significantly greater financial,
technical, sales, and marketing resources, and engage in more extensive research and development than we do. Some of our competitors also have lower
customer acquisition costs than we do, offer a wider variety of services, have more compelling websites with more extensive user-generated or third-
party content or offer their services or content free to their users. Some of our competitors have been more successful than we have been in attracting
and retaining visitors and members, and our ability to attract visitors to our websites and maintain a large and growing member base has been adversely
affected by such competition. In particular, Facebook's membership base currently far exceeds that of any of its competitors. If our competitors provide
services similar to our social networking services for free, we may not be able to charge for our social networking services. We rely on some of our
competitors to promote our services and for new member acquisitions, such as Facebook in connection with our Facebook high school fan pages. Any
changes to Facebook's rules or policies or any other changes implemented by Facebook could adversely affect our business or our strategies.
Competition has adversely affected our subscription revenues from social networking services, as well as our advertising revenues from our social
networking services and loyalty marketing service. More intense competition could also require us to increase our marketing or other expenditures. As a
result of competition, our business, financial condition, results of operations, and cash flows have been adversely affected.
Continued declines in the number of pay accounts for our social networking services could cause our business, financial condition, results of
operations, and cash flows to suffer.
Pay accounts are critical to our business model. Only a small percentage of users visiting our websites or initially registering for our social
networking services sign up for a paid subscription at the time of registration. As a result, our ability to generate subscription revenues is highly
dependent on our ability to attract visitors to our websites, register them as free members, encourage them to return to our websites, and convince them
to become pay accounts in order to access the pay features of our websites. In addition, changes to our registration or renewal processes, such as the
changes required for
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