Stamps.com 2001 Annual Report Download - page 19

investments, we continue to evaluate incremental revenue opportunities and derivative applications of our technology and may pursue and
develop those opportunities with strategic partners and investors, both domestically and internationally. To the extent we pursue new or
complementary businesses, we may not be able to expand our service offerings and related operations in a cost-effective or timely manner. We
may experience increased costs, delays and diversions of management's attention when integrating any new businesses or service. We may lose
key personnel from our operations or those of any acquired business. Furthermore, any new business or service we launch that is not favorably
received by users could damage our reputation and brand name in the Internet postage or other markets that we enter. We also cannot be certain
that we will generate satisfactory revenues from any expanded services or products to offset related costs. Any expansion of our operations
would also require significant additional expenses, and these efforts may strain our management, financial and operational resources.
Additionally, future acquisitions may also result in potentially dilutive issuances of equity securities, the incurring of additional debt, the
assumption of known and unknown liabilities, and the amortization of expenses related to goodwill and other intangible assets, all of which
could have a material adverse effect on our business, financial condition and operating results. New issuances of securities may also have rights,
preferences and privileges senior to those of our common stock.
Risks Related to Our Industry
US Postal Service regulations and fee assessments may cause disruptions or discontinuance of our business, may increase the cost of our service
and may affect the adoption of Internet postage as a new method of mailing.
We are subject to continued US Postal Service scrutiny and other government regulations. The continued availability of our Internet postage
services is dependent upon our service continuing to meet US Postal Service performance specifications and regulations. The US Postal Service
could change its certification requirements or specifications for Internet postage or revoke the approval of our service at any time. If at any time
our Internet postage service fails to meet US Postal Service requirements, we may be prohibited from offering this service and our business
would be severely and negatively impacted. In addition, the US Postal Service could suspend, terminate or offer services which compete against
Internet postage, any of which could stop or negatively impact the commercial adoption of our Internet postage services. Any changes in
requirements or specifications for Internet postage could adversely affect our pricing, cost of revenues, operating results and margins by
increasing the cost of providing our Internet postage service.
The US Postal Service could also decide that Internet postage should no longer be an approved postage service due to security concerns or
other issues. Our business would suffer dramatically if we are unable to adapt our Internet postage services to any new requirements or
specifications or if the US Postal Service were to discontinue Internet postage as an approved postage method. Alternatively, the US Postal
Service could introduce competitive programs or amend Internet postage requirements to make certification easier to obtain, which could lead
to more competition from third parties or the US Postal Service itself. See Risk Factors--If we are unable to compete successfully, particularly
against large, traditional providers of postage products like Pitney Bowes who enter the online postage market, our revenues and operating
results will suffer.
In addition, US Postal Service regulations may require that our personnel with access to postal information or resources receive security
clearance prior to doing relevant work. We may experience delays or disruptions if our personnel cannot receive necessary security clearances
in a timely manner, if at all. The regulations may limit our ability to hire qualified personnel. For example, sensitive clearance may only be
provided to US citizens or aliens who are specifically approved to work on US Postal Service projects.
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2002. EDGAR Online, Inc.