Annual report (20-F) - Ono

• inability to retain customers following the acquisition;
• potential disruptions to our ongoing business caused by senior management’s focus on the
acquired companies;
• difficulty to maintain uniform quality standards, controls, procedures and policies; and
• the impairment of relationships with employees as a result of changes in management and
ownership.
When we integrate any potential future acquisitions, we cannot assure you that we will be
successful in managing the foregoing or any other risks. Our failure to overcome these and other risks
could have a material adverse effect on our business, financial condition and results of operations.
In addition to the foregoing, the integration of Retecal into the ONO Group will increase the debt
levels in the ONO Group.
Our business depends on equipment and service suppliers, who may fail to provide
necessary equipment and services on a timely basis, discontinue their products or seek to charge us
prices that are not competitive; any of which could adversely affect our business or profitability.
We depend upon a small number of major suppliers, including Alcatel and Motorola for essential
products and services relating to our network infrastructure. These suppliers may, among other things,
extend delivery times, supply unreliable equipment, raise prices and limit or discontinue supply due to
their own shortages or business requirements.
In most cases, we have made substantial investments in the equipment or software of a particular
supplier, making it difficult for us to rapidly change such relationships if a current supplier is unable or
unwilling to offer us reasonable prices or ceases to produce equipment or provide the services we require.
If these suppliers are unable or unwilling to deliver products and services on a timely basis and
at reasonable prices or their products are found to be faulty, our ability to provide products and services to
our customers at competitive prices might be adversely affected, which could negatively impact our
growth, financial condition and results of operations.
Unanticipated network interruptions may adversely affect our ability to deliver our
products and services.
Our business is dependent on the continued and uninterrupted performance of our network. We
manage and monitor our network on a 24 hours a day, 365 days a year basis. However, system, network,
hardware and software failures, have occurred and could occur in the future and affect the quality of, or
cause an unexpected interruption in, our service. These failures could result in costly repairs and affect
customer satisfaction thereby reducing our customer base and revenues, and damaging our brand image.
Moreover if any part of our network is affected by flood, fire or other natural disaster, terrorism,
power loss or other catastrophe, our operations and customer relations could be materially adversely
affected. Our disaster recovery, security and service continuity protection measures include back-up
power systems, resilient ring network systems, and network monitoring. However, we cannot assure you
that these precautions will be sufficient to prevent loss of data or prolonged network downtime.
In addition, our business is dependent on certain sophisticated critical systems, including our
switches, billing and customer service systems. The hardware supporting those systems is housed in a
relatively small number of locations and if damage were to occur to any such locations or if those systems
develop other problems, there could be a material adverse effect on our business.
Our business depends on the continuous maintenance and improvement of our network,
systems and operations.
We must continuously maintain and improve our networks in a timely and cost-effective manner
in order to maintain and expand our customer base, services offer and quality of service, enhance our
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