Juno 2014 Annual Report Download - page 17

Table of Contents
credit card information, of our members and of third parties. A number of other websites have publicly disclosed breaches of their security, some of which
have involved sophisticated and highly targeted attacks on portions of their sites. Because the techniques used to obtain unauthorized access, disable or
degrade service, or sabotage systems change frequently and often are not recognized until launched against a target, we may be unable to anticipate these
techniques or to implement adequate preventative measures. If an actual or perceived breach of our security occurs, the perception of the effectiveness of our
security measures could be harmed and we could lose members or vendors. A party that is able to circumvent our security measures could misappropriate our
proprietary information or the information of our members, cause interruption in our operations, or damage our computers or other devices or those of our
members.
A significant number of our members authorize us to bill their payment card accounts (credit or debit) directly for all amounts charged by us. These
members provide payment card information and other personally identifiable information which, depending on the particular payment plan, may be
maintained to facilitate future payment card transactions. We rely on third-party and internally-developed encryption and authentication technology to
provide the security and authentication to effectively secure transmission of confidential information, including payment card information. Advances in
computer capabilities, new discoveries in the field of cryptography, or other developments may result in the technology used by us to protect transaction data
being breached or compromised. Non-technical methods, for example, actions by an employee, can also result in a data breach. Under payment card rules and
our contracts with our card processors, if there is a breach of payment card information that we store, we could be liable to the banks that issue the payment
cards for their related expenses and penalties. In addition, if we fail to follow payment card industry security standards, even if there is no compromise of
customer information, we could incur significant fines or lose our ability to give our members and customers the option of using payment cards. If we were
unable to accept payment cards, our businesses would be seriously harmed.
We may need to expend significant resources to protect against security breaches or to address problems caused by breaches. Security breaches,
including any breach related to us or the parties with which we have commercial relationships, could damage our reputation and expose us to a risk of loss,
litigation and liability. We cannot assure you that the security measures we take will be effective in preventing these types of activities. We also cannot
assure you that the security measures of our third-party vendors, including network providers, providers of customer and billing support services, and other
vendors, will be adequate. In addition, the coverage and limits of our insurance policies may not be adequate to reimburse us for losses caused by security
breaches. In addition to potential legal liability, these matters may adversely impact our reputation or our revenues and may interfere with our ability to
provide our services and products, all of which could adversely impact our business, financial condition, results of operations, and cash flows.
Our marketing efforts may not be successful or may become more expensive, either of which could increase our costs and adversely impact our business,
financial condition, results of operations, and cash flows.
We spend significant resources marketing our brands, services, and products. We rely on relationships with a wide variety of third parties, including
Internet search providers such as Google, social networking platforms such as Facebook, Internet advertising networks, co-registration partners, retailers,
distributors, television advertising agencies, and direct marketers, to source new members and to promote or distribute our services and products. In addition,
in connection with the launch of new services or products, we may spend a significant amount of resources on marketing. With any of our brands, services,
and products, if our marketing activities are inefficient or unsuccessful, if important third-party relationships or marketing strategies, such as Internet search
engine marketing and search engine optimization, become more expensive or unavailable, or are suspended, modified, or terminated, for any reason, if there
is an increase in the proportion of consumers visiting our websites or purchasing our services and products by way of marketing channels with higher
marketing costs as
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