TeleNav 2014 Annual Report Download - page 25

Table of Contents
imposition of monetary liability. We may also be contractually liable to indemnify and hold harmless our clients from the costs or consequences
of inadvertent or unauthorized disclosure of data that we store or handle as part of providing our services.
The regulatory framework for privacy issues worldwide is evolving, and various government and consumer agencies and public advocacy
groups have called for new regulation and changes in industry practices, including some directed at the mobile and advertising industries in
particular. It is possible that new laws, regulations, standards, recommendations, best practices or requirements will be adopted that would affect
our business, particularly with regard to location-based services, collection or use of data to target ads and communication with consumers via
mobile devices. To the extent that we or our clients are subject to new law or recommendations or choose to adopt new standards,
recommendations, or other requirements, we may have greater compliance burdens. If we are perceived as not operating in accordance with
industry best practices or any such guidelines or codes with regard to privacy, our reputation may suffer and we could lose relationships with
advertiser or developer partners.
We operate in a highly competitive market, including competitors that offer their services for free, which could make it difficult for us to
acquire and retain wireless carrier customers and end users.
The market for development, distribution and sale of location services is highly competitive. Many of our competitors have greater name
recognition, larger customer bases and significantly greater financial, technical, marketing, public relations, sales, distribution and other
resources than we do. Competitors may offer mobile location services that have at least equivalent functionality to ours for free. For example,
Google offers free voice-guided turn by turn navigation as part of its Google Maps product for mobile devices based on the Android operating
system platform, and recently introduced a similar new product for the iOS platform. Apple offers proprietary maps and voice-guided turn by
turn directions and Nokia, provides a download for its latest version of HERE Maps on its smartphones which also provides voice-guided turn
by turn navigation functions. Microsoft also provides a free voice-guided turn by turn navigation solution on its Windows Mobile and Windows
Phone operating systems. Competition from these free offerings may reduce our revenue, result in our incurring additional costs to compete and
harm our business. We also do not know what the effect of the acquisition of Nokia’s mobile phone business by Microsoft will have on
competition in the mobile navigation market. If our wireless carrier customers can offer these mobile location services to their subscribers for
free, they may elect to cease their relationships with us, like Sprint did, or alter or reduce the manner or extent to which they market or offer our
services or require us to substantially reduce our fees or pursue other business strategies that may not prove successful. In addition, new car
buyers may not value navigation solutions built in to their vehicles if they feel that free (brought-in) offerings, for example Apple CarPlay or
Google's auto initiatives, including Open Automotive Alliance, are adequate and may not purchase our solutions with their new cars.
Our primary competitors include location service providers such as Apple, Google (including Waze), Microsoft, Nokia, TCS, and
TomTom; PND providers such as Garmin and TomTom; providers of Internet and mobile based maps and directions such as AOL, Apple,
Mapquest, Google, Microsoft, Yahoo, Yelp, Foursquare and Fullpower; and wireless carriers and communication solutions providers developing
their own location services. In the automotive navigation market, we compete with established automotive OEMs and providers of on-board
navigation services such as AISIN, Bosch, Elektrobit, Garmin, TomTom and Nav N Go, as well as other competitors such as Apple, Google,
Microsoft and TCS. In our advertising business, we compete against mobile platform providers, including Google, Apple, and Millennial Media,
among others. Some of our competitors’ and our potential competitors’ advantages over us, either globally or in particular geographic markets,
include the following:
•
the provision of their services at no or low cost to consumers;
•
significantly greater revenue and financial resources;
•
stronger brand and consumer recognition regionally or worldwide;
•
the capacity to leverage their marketing expenditures across a broader portfolio of mobile and nonmobile products;
•
access to core technology and intellectual property, including more extensive patent portfolios;
•
access to custom or proprietary content;
•
quicker pace of innovation;
•
stronger wireless carrier, automotive, handset manufacturer and advertising agency relationships;
•
stronger international presence may make our larger competitors more attractive partners to automotive manufacturers and OEMs;
•
greater resources to make and integrate acquisitions;
•
lower labor and development costs; and
•
broader global distribution and presence.