Support.com 2011 Annual Report Download - page 29

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Revenue
   

   

  
Services $ 37,248 15% $ 32,276 92% $ 16,770
Software and other 16,591 39% 11,901 1,542% 725
Total revenue $ 53,839 22% $ 44,177 153% $ 17,495
Services revenue consists primarily of fees for technology services through our channel partners or directly. We provide these services
remotely, using work-from-home Personal Technology Experts and contractors who utilize our proprietary technology to deliver the
services. Services revenue for the year ended December 31, 2011 increased by $4.9 million from 2010. The increase was primarily due to growth in
our channel programs, primarily expansion of the Comcast program. For the year ended December 31, 2011, services revenue generated from our
channel partnerships was $34.5 million compared to $28.8 million for 2010. Direct services revenue was $2.8 million in 2011 compared to $3.6
million in 2010. Services revenue for the year ended December 31, 2010 increased by $15.5 million from 2009. The increase was primarily driven
by growth in certain channel partnerships. Services revenue generated from our channel partnerships was $28.8 million for the year ended December
31, 2010 compared to $15.2 million for 2009. Direct services revenue was $3.6 million in 2010 compared to $1.7 million in 2009. We expect
services revenue to continue to grow in 2012 as a result of expansion of established programs, development of new partnerships with additional
channel partners, and launch of our small business programs. In addition, we expect subscription revenue to become a larger portion of total services
revenue in 2012 as compared to 2011.
Software and other revenue is comprised primarily of fees for software products provided through direct consumer downloads and, to a lesser
extent, through the sale of this software via channel partners. Software and other revenue for the twelve months ended December 31, 2011 increased
by $4.7 million compared to the same period of 2010, driven by growth in an existing channel partnership, optimization of the monetization of our
ARO product and the availability of favorably-priced advertising inventory during the first half of 2011. The year-over-year growth in software and
other revenue from 2010 to 2011 also reflects results of selling the software products acquired in our purchase of substantially all of the assets of
SUPERAntiSpyware in June of 2011. Direct software revenue and other was $11.3 million for the year ended December 31, 2011 compared to $9.9
million for 2010. Software revenue and other generated from our channel partnerships was $5.3 million in 2011 compared to $1.9 million for 2010.
Software and other revenue was $11.9 million for the year ended December 31, 2010 compared to $725,000 for the year ended December 31,
2009. The year-over-year growth in software and other revenue from 2009 to 2010 reflects full-year results of selling the products acquired in our
purchase of substantially all of the assets of Xeriton Corporation in December of 2009 and increases in the sales of such products under our
ownership relative to their run rate when acquired. We expect software revenue levels in 2012 to be determined by progress on new initiatives
including enhancing key products, broadening third-party distribution and deploying new customer acquisition strategies.
Revenue Mix
The components of revenue by type, expressed as a percentage of total revenue were:

 
      
Services 69% 73% 96%
Software and other 31 27 4
Total revenue 100% 100% 100%
We expect that services revenue will continue to comprise a substantial majority of our total revenue but that software and other revenue will
represent a material percentage of our total revenue over the next year.
For the year ended December 2011, Office Depot, Staples and Comcast accounted for 23%, 15% and 14% of our total revenue,
respectively. For the year ended December 31, 2010, Office Depot and Staples accounted for 43% and 17% of our total revenue, respectively. For
the year ended December 31, 2009, Office Depot accounted for 82% of our total revenue. No other customers accounted for 10% or more of our total
revenue in any year presented. Revenue from customers outside the United States accounted for approximately 1%, 1% and 2% of our total revenue
in 2011, 2010 and 2009, respectively.
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