Tucows 2014 Annual Report Download - page 51

We rely on bandwidth providers, data centers and other vendors in providing services to our customers, and any
failure or interruption in the services provided by these third parties could harm our ability to operate our business
and damage our reputation.
We rely on vendors, including data center and bandwidth providers in providing services to our customers. Any
disruption in the network access or co-location services provided by these providers or any failure of these providers to
handle current or increased volumes of use could significantly harm our business. Any financial or other difficulties our
providers face may also have negative effects on our business. We exercise little control over these vendors, which
increases our vulnerability to problems with the services they provide. We license technology and related databases to
facilitate certain aspects of our data center and connectivity operations, including Internet traffic management services.
We have experienced and expect to continue to experience interruptions and delays in service and availability for such
elements. Any errors, failures, interruptions or delays in connection with these technologies and information services
could harm our relationship with customers, adversely affect our brand and expose us to liabilities.
New tax treatment of companies engaged in Internet commerce may adversely affect the demand for our marketing
services and our financial results.
Due to the global nature of the Internet, it is possible that, although our services and the Internet transmissions
related to them typically originate in Virginia, Toronto and Germany, governments of other states or foreign countries
might attempt to regulate our transmissions or levy sales, income or other taxes relating to our activities. Tax authorities
at the international, federal, state and local levels are currently reviewing the appropriate treatment of companies engaged
in Internet commerce. New or revised international, federal, state or local tax regulations may subject us or our customers
to additional sales, income and other taxes. We cannot predict the effect of current attempts to impose sales, income or
other taxes on commerce over the Internet on Tucows or on our customers. New or revised taxes and, in particular, sales
taxes, would likely increase the cost of doing business online and decrease the attractiveness of advertising and selling
goods and services over the Internet. New taxes could also create significant increases in internal costs necessary to
capture data, and collect and remit taxes. Any of these events could have an adverse effect on our business and results of
operations.
We may be accused of intellectual property infringement of the technology we have employed to support both our back
end platform and the products and services we offer to and through our resellers and may be sued for damages caused
by actual use of the platforms or products and services and we may be required to pay substantial damage awards.
We seek to ensure that we have licensed or otherwise secured the necessary rights to use and offer for use all
intellectual property relating to our platforms and the services we offer resellers through the platforms. Despite our
efforts, we may be sued by third parties claiming rights in and to the technology we employ or by third parties who claim
to have suffered as a result of any use, or inability to use, the platforms, products and services. If we are sued, defense of
any such claims may require the resources of both our time and money. If a third-party is successful in its assertions, we
may be required to pay damages that may have a material impact on our financial resources.
Ting may lose customers if it fails to keep up with rapid technological change occurring in the wireless industry.
The wireless communications industry is experiencing significant technological change, including ongoing
improvements in the capacity and quality of digital technology, the development and commercial acceptance of wireless
broadband data services, shorter development cycles for new products and enhancements, and changes in consumer
requirements and preferences. These changes may cause uncertainty about future demand for our wireless services and
may affect the prices that we will be able to charge for these services. Rapid changes in technology, moreover, may lead
to the development of wireless communications services or alternative services that consumers prefer over our services.
Our operational performance and financial results may be adversely affected if we are unable to deploy future
technologies or services on a timely basis or at an acceptable cost.
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