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Technology Stocks : DRIV (DIGITAL RIVER). Get in on internet IPO. -- Ignore unavailable to you. Want to Upgrade?

To: ztect who wrote (111)	8/22/1998 7:26:00 PM
From: ztect	Respond to of 3198

IMO if you access the risk factors from edgar-online.com you can see real potential for future earnings ie. as the internet expands. POTENTIAL FLUCTUATIONS IN OPERATING RESULTS. The Company's quarterly and annual operating results are likely to fluctuate significantly in the future due to a variety of factors, many of which are outside the Company's control. Factors that will influence the Company's operating results include: (i) the Company's ability to retain existing software publishers and online retailers as clients, to attract new software publishers and online retailers as clients at a steady rate and to maintain software publisher, online retailer and end-user satisfaction; (ii) the announcement or introduction of new Web sites, Web stores, services and products by the Company and its competitors; (iii) price competition and margin erosion; (iv) the level of use of the Internet and consumer acceptance of the Internet for the purchase of consumer products such as those offered by the Company; (v) the Company's ability to upgrade and develop its systems and infrastructure, in particular its CNS; (vi) the termination of any strategic accounts such as Corel Corporation, from which the Company derives a significant portion of its sales; (vii) technical difficulties or system downtime; (viii)the Company's ability to attract new personnel in a timely and effective manner; (ix) the mix of sales generated through software publisher client Web stores compared to online retailer Web stores; (x) the failure of Internet bandwidth to increase over time and/or an increase in the cost to end-users of obtaining or utilizing Internet bandwidth; (xi) the amount and timing of operating costs and capital expenditures relating to expansion of the Company's business, operations and infrastructure; (xii) certain U.S. and foreign government regulations; (xiii) the failure of the Internet to continue to develop as a viable commercial marketplace. The Company also may, as inducement to obtain certain strategic contracts, offer certain economic terms to software publishers and online retailers which will reduce its gross margins. As a result, the Company believes that it will continue to incur operating losses in the future. Due to the foregoing factors, the Company's annual or quarterly operating results may fall below the expectations of securities analysts and investors. In such event, the trading price of the Common Stock would likely be materially adversely affected.

To: ztect who wrote (111)	8/22/1998 7:38:00 PM
From: ztect	Read Replies (1) \| Respond to of 3198

"RISKS ASSOCIATED WITH ESD; MARKET ACCEPTANCE OF ESD. The Company's success will depend in large part on end-user acceptance of ESD as a method of distributing software. ESD is a relatively new method of distributing software products and the growth and market acceptance of ESD is highly uncertain and subject to a number of risks. Factors that will influence market acceptance of ESD include: the availability of sufficient network bandwidth to enable purchasers to rapidly download software, the impact of time-based Internet access fees, the number of software products that are available for purchase through ESD as compared to those available through physical delivery, the level of end-user comfort with the process of downloading software via the Internet and the relative ease of such process and concerns about transaction security. If ESD does not achieve widespread market acceptance, the Company's business, financial condition and results of operations would be materially adversely affected. Even if ESD achieves widespread acceptance, there can be no assurance that the Company will overcome the substantial existing and future technical challenges associated with electronically delivering software reliably and consistently on a long-term basis. The failure by the Company to do so would materially and adversely affect the Company's business, financial condition and results of operations." DEPENDENCE ON SOFTWARE PUBLISHERS. The Company is entirely dependent upon the software publishers that supply it with software, and the availability of such software is unpredictable. The Company's contracts with its software publisher clients are generally one year in duration, with an automatic renewal provision for additional one-year periods, unless the Company is provided with a written notice at least 90 days prior to the termination of the contract. As is common in the industry, the Company has no long-term or exclusive contracts or arrangements with any software publisher that guarantees the availability of software products. There can be no assurance that the software publishers that currently supply software to the Company will continue to do so or that the Company will be able to establish new relationships with software publishers. If the Company is unable to develop and maintain satisfactory relationships with software publishers on acceptable commercial terms, if the Company is unable to obtain sufficient quantities of software, if the quality of service provided by such software publishers falls below a satisfactory standard or if the Company's level of returns exceeds its clients' expectations, the Company's business, financial condition and results of operations could be materially adversely affected. DEPENDENCE ON ONLINE RETAILERS. The Company's strategy is dependent upon increasing its sales of software products through online retailers. The Company has historically generated substantially all of its sales from the sale of software to end-users that were initiated through its software publisher clients' Web stores. In 1997 and the six months ended June 30, 1998, less than 6% of the Company's sales were generated through online retailer clients' Web stores. While the Company plans to increase its sales and marketing efforts over time in an effort to generate increased sales from online retailer clients, there can be no assurance that the Company will be successful in entering into contractual relationships with additional online retailers or that its current contractual relationships will be renewed. The Company's failure to enter into contractual relationships with major online retailers or a substantial number of smaller online retailers or the failure to renew its existing online retailer contracts could have a material adverse impact upon the Company's business,financial condition and results of operations."