Stamps.com 2015 Annual Report Download - page 25

TABLE OF CONTENTS
programsoramendPCPostagerequirementstomakecertificationeasiertoobtain,whichcouldleadtomorecompetitionfromthird
partiesortheUSPSitself.Ifweareunabletocompetesuccessfully,particularlyagainstlarge,traditionalprovidersofpostageproducts,
suchasPitneyBowes,whoentertheonlinepostagemarket,ourrevenuesandoperatingresultswillsuffer.
TheUSPScoulddecidethatourcustomizedpostageproductsshouldnolongerbeapprovedproductsforsuchreasonsasthebelief
thattheypresentanunacceptablerisktoUSPSrevenues,exposestheUSPSoritscustomerstolegalliability,orcausespublicor
politicalembarrassmentorharmtotheUSPSinanyway.IftheUSPSweretodiscontinueourcustomizedpostageproducts,our
revenuesandoperatingresultswouldsuffer.
Inaddition,USPS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USPSprojects.
Finally,anyapprovedUSPSmarkettestornewservicethatbenefitsuscouldalsoultimatelybesuspendedorcancelledbythe
USPS,causingdisruptionstoourbusiness.
The USPS could modify or terminate agreements and other financial compensation arrangements.
TheUSPScoulddecidetoamend,renegotiateorterminateagreementsorfinancialcompensationarrangementsthatexistnowor
inthefuture.Forinstance,iftheUSPSdecidestoamend,renegotiateorterminateourcreditcardcostsharingagreements,which
governtheallocationofcreditcardfeespaidbytheUSPSandus,ourrevenuesandoperatingresultscouldsuffer.Inaddition,ifthe
USPSdecidestoamendorrenegotiateourarrangementsunderwhichwearecompensateddirectlybytheUSPSforshippingcustomers
orintegrationpartnerswhoprintacertainamountofpostage,ourrevenueandoperatingresultsmaybenegativelyimpacted.Ifthe
USPSdecidestoterminateouragreementsunderwhichwearecompensateddirectlybytheUSPSforshippingcustomersorintegration
partnerswhoprintacertainamountofpostage,ourrevenueandoperatingresultswouldsuffer.
The USPS could modify or terminate discounts our customers receive.
TheUSPScoulddecidetoamendorterminatethediscountsourcustomersandintegrationpartnersreceive.Customersusingour
servicesreceivediscountedpostagerates,eitherfromStamps.comorfromintegrationpartnersthatprovidediscountedrates,compared
toUSPSretailratesoncertainmailpiecessuchasFirstClasslettersandpackages,domesticandinternationalPriorityMailandPriority
MailExpresspackages,andotherdiscountsavailabletohigh-volumeshippingcustomers.IftheUSPSdecidestowithdrawcertain
discountsorevenremovethediscountsentirely,ourrevenueandoperatingresultswillsuffer.IfthePostalRegulatoryCommission
decidesthediscountsareunlawfulandrequiretheUSPStocancelorchangethem,thenourrevenueandoperatingresultswouldsuffer.
If we are unable to compete successfully against alternative methods of accessing relevant mailing and shipping services, our
revenues and operating results will suffer.
Wecompetewithallofthealternatewaysthatconsumersandbusinessesmayaccessmailingandshippingservicesfromthe
USPS,includingthefollowing:onlineservicesavailableatUSPS.com;USPSretaillocations;USPSkiosks;multi-carriersolutions;
integratedwebshippingsolutionssuchaseBay/PayPalorAmazon.com;traditionalpostagemeters;otherUSPSapprovedPCPostage
vendors;USPSpermitmanifestingsolutions;andcommercialretaillocationsthatsellpostageorshippingservices(forexample
grocerystores,discountwarehouses,smallbusinessmailingandshippingcenters,officesupplychains,andothers).Someofthese
alternativemeansofaccessingUSPSservicesareavailablewithnoadditionalmarkupoverthefacevalueofpostageandsomeare
availablewithdiscountedpostageratesthatarebetterthanthediscountsthatweareabletoprovidetoourcustomers.Withour2014
acquisitionsofShipStationandShipWorks,wealsonowcompetewithmulti-carriersolutionsproviders.Wealsocompetewiththe
technologysolutionsavailablefromprivatecarriersthatallowcustomerstoaccessthoseprivatecarriers,andwhicharetypically
providedtothecustomersfornoadditionalfees.
Wemaynotbeabletoestablishormaintainacompetitivepositionagainstcurrentorfuturecompetitorsastheyenterthemarket.
Manyofourcompetitorshavelongeroperatinghistories,largercustomerbases,greater
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