1270400--3/1/2007--VIRGIN_MEDIA_INVESTMENT_HOLDINGS

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Risks Relating to Our Business and Industry We are subject to significant competition and we expect that competition will intensify. Failure to control customer churn may adversely affect our financial performance. The sectors in which we compete are subject to rapid and significant changes in technology, and the effect of technological changes on our businesses cannot be predicted. We are licensed to use the Virgin name and logo but do not own it. If we do not maintain and upgrade our networks in a cost-effective and timely manner, we could lose customers. A failure in our critical systems could significantly disrupt our operations, which could reduce our customer base and result in lost revenues. Our inability to obtain popular programming, or to obtain it at a reasonable cost, could potentially materially adversely affect the number of customers or reduce margins. Revenue from our content segment is highly dependent on subscriber fees and the television advertising market. We depend on equipment and service suppliers that may discontinue their products or seek to charge us prices that are not competitive, either of which may adversely affect our business and profitability. The integration of our billing systems may have an adverse effect on our customer service, customer acquisitions, customer churn rate and operating costs. Regulation of the markets in which we provide our services has been changing rapidly; unpredictable changes in U.K. and EU regulations affecting the conduct of our business, including price regulations, may have an adverse impact on our ability to set prices, enter new markets or control our costs. We are subject to tax in more than one tax jurisdiction and our structure poses various tax risks. There is no assurance that new products we may introduce will achieve full functionality or market acceptance. Virgin Mobile relies on T-Mobile s network to carry its communications traffic. We rely on third parties to distribute our Virgin Mobile products and procure customers for our services. We depend on the ability to attract and retain key personnel without whom we may not be able to manage our business lines effectively. Certain of our significant stockholders could have an influence over our business and affairs. Disruptions in Virgin Media TV s or sit-up s satellite transmissions could materially adversely affect their respective operations. Unauthorized access to our networks could result in a loss of revenue. We do not insure the underground portion of our cable network and various pavement-based electronics associated with our cable network. Risks Relating to Our Recent Acquisitions We may be unable to successfully integrate operations and realize the full anticipated synergies of our recent acquisitions, which may harm the value of our securities. We have incurred and will continue to incur significant costs in connection with the merger and acquisition. We could suffer losses due to asset impairment charges for goodwill and long-lived intangible assets. Risks Relating to Our Financial Indebtedness and Structure We may not be able to fund our debt service obligations through operating cash flow in the future. Our current leverage is substantial, which may have an adverse effect on our available cash flow, our ability to obtain additional financing if necessary in the future, our flexibility in reacting to competitive and technological changes and our operations. We have incurred losses in the past and may not be profitable in the future. The restrictive covenants under our debt agreements may limit our ability to operate our business. We are a holding company dependent upon cash flow from subsidiaries to meet our obligations. We are subject to currency and interest rate risks. We may not have sufficient financial resources to repay our debt upon a change of control. Risks Relating to Our Common Stock The market price of our common stock is subject to volatility, as well as to trends in the telecommunications industry in general, which will continue. We may in the future seek to raise funds through equity offerings, which could have a dilutive effect on our common stock. We have not historically paid cash dividends on our common stock, we may not be able to continue to pay dividends, and the failure to do so could adversely affect our stock price. Sales of stock by stockholders in the company may decrease the price of the common stock. Provisions of our debt agreements, our stockholder rights plan, our certificate of incorporation, Delaware law and our contracts could prevent or delay a change of control of us.

Full 10-K form ▸

1270400--3/1/2007--VIRGIN_MEDIA_INVESTMENT_HOLDINGS_LTD