794323--3/2/2006--LEVEL_3_COMMUNICATIONS

related topics

{product, market, service}

{customer, product, revenue}

{debt, indebtedness, cash}

{acquisition, growth, future}

{property, intellectual, protect}

{system, service, information}

{condition, economic, financial}

{regulation, government, change}

{operation, international, foreign}

{competitive, industry, competition}

{cost, regulation, environmental}

{capital, credit, financial}

{financial, litigation, operation}

{operation, natural, condition}

{provision, law, control}

{personnel, key, retain}

{stock, price, share}

{tax, income, asset}

{control, financial, internal}

{stock, price, operating}

{gas, price, oil}

We need to continue to increase the volume of traffic on our network or we will not generate profits Our VoIP services have only been sold for a limited period and there is no guarantee that these services will gain broad market acceptance The success of our subscriber based VoIP services is dependent on the growth and public acceptance of VoIP telephony The prices that we charge for our communications services have been decreasing, and we expect that they will continue to decrease over time and we may be unable to compensate for this lost revenue Revenue under our agreement with SBC Services is expected to decline materially Failure to complete development, testing and introduction of new services, including VoIP services, could affect our ability to compete in the industry Our communications revenue is concentrated in a limited number of customers During our communications business operating history, we have generated substantial losses, which we expect to continue Our need to obtain additional capacity for our network from other providers increases our costs Our business requires the continued development of effective business support systems to implement customer orders and to provide and bill for services Our growth may depend upon our successful integration of acquired businesses We may not be able to integrate WilTel operations with our business efficiently We may be unable to hire and retain sufficient qualified personnel; the loss of any of our key executive officers could adversely affect us We must obtain and maintain permits and rights-of-way to operate our network Termination of relationships with key suppliers could cause delay and costs Rapid technological changes can lead to further competition Increased industry capacity and other factors could lead to lower prices for our services We are subject to significant regulation that could change in an adverse manner We may lose customers if we experience system failures that significantly disrupt the availability and quality of the services that we provide Intellectual property and proprietary rights of others could prevent us from using necessary technology to provide Internet protocol voice services Canadian law currently does not permit us to offer directly services in Canada Potential regulation of Internet service providers in the United States could adversely affect our operations The communications and information services industries are highly competitive with participants that have greater resources and a greater number of existing customers We may be unable to successfully identify, manage and assimilate future acquisitions, investments and strategic alliances, which could adversely affect our results of operations Software Spectrum relies on financial incentives, credit terms, such as rebates, volume purchase discounts, marketing development funds and prompt-payment discounts from software publishers As publishers change their distribution model, Software Spectrum increasingly relies on sales agency fees Software Spectrum is very dependent on a small number of vendors Software Spectrum's business is dependent on certain key distributors Software Spectrum's business is subject to seasonal changes in demand and resulting sales activities Software Spectrum's business is sensitive to general economic conditions and conditions in the software and IT industries Software Spectrum's international operations are sensitive to currency risks Software Spectrum is exposed to the risks of a global market Software Spectrum operates in a highly-competitive business environment and is subject to significant price competition Software Spectrum's new Media Plane platform Software Spectrum may not succeed in protecting its intellectual property Software Spectrum may incur substantial costs defending or protecting against third-party claims Environmental liabilities from our historical operations could be material Potential liabilities and claims arising from coal operations could be significant If we are unable to comply with the restrictions and covenants in our debt agreements, there would be a default under the terms of these agreements, and this could result in an acceleration of payment of funds that have been borrowed We have substantial debt, which may hinder our growth and put us at a competitive disadvantage We may not be able to repay our existing debt; failure to do so or refinance the debt could prevent us from implementing our strategy and realizing anticipated profits Restrictions and covenants in our debt agreements limit our ability to conduct our business and could prevent us from obtaining needed funds in the future If certain transactions occur with respect to our capital stock, we may be unable to fully utilize our net operating loss carryforwards to reduce our income taxes Increased scrutiny of financial disclosure, particularly in the telecommunications industry in which we operate, could adversely affect investor confidence, and any restatement of earnings could increase litigation risks and limit our ability to access the capital markets Terrorist attacks and other acts of violence or war may adversely affect the financial markets and our business Our international operations and investments expose us to risks that could materially adversely affect the business Anti-takeover provisions in our charter and by-laws could limit the share price and delay a change of management If a large number of our shares of common stock are sold in the public market, the sales could reduce the trading price of our common stock and impede our ability to raise future capital The market price of our common stock has been subject to volatility and, in the future, the market price of our common stock may fluctuate substantially due to a variety of factors

Full 10-K form ▸

794323--3/2/2006--LEVEL_3_COMMUNICATIONS_INC