Significant Risk Concentrations

6 Months Ended

Jun. 30, 2011

Significant Risk Concentrations

Significant Risk Concentrations

8. Significant Risk Concentrations

Significant Customer

Ford Motor Company ("Ford") accounted for $2.4 million or 10% of total revenue for the three months ended June 30, 2011 and $4.7 million, or 10%, of total revenue for the six months ended June 30, 2011. Ford accounted for $6.2 million, or 23%, of total revenue for the three months ended June 30, 2010 and $8.5 million, or 19%, of total revenue for the six months ended June 30, 2010. No other customer accounted for 10% or more of total revenue for the three and six months ended June 30, 2011, or June 30, 2010.

Ford had an accounts receivable balance of $1.7 million, or 13% of total accounts receivable, as of June 30, 2011. Ford had an accounts receivable balance of $7.5 million, or 45% of total accounts receivable, as of June 30, 2010. No other customer accounted for 10% or more of total accounts receivable as of June 30, 2011 or December 31, 2010.

Significant Supplier

We have OEM Distribution Agreements ("ODAs") with Microsoft which enable us to sell Microsoft Windows Embedded operating systems to our customers in the United States, Canada, the Caribbean (excluding Cuba), Mexico, the European Union and the European Free Trade Association, which expire on June 30, 2012. We also have ODAs with Microsoft which allow us to sell Microsoft Windows Mobile operating systems, and related applications such as Office Mobile, on a world-wide basis, which expire on October 31, 2011.

Software sales under these agreements constitute a significant portion of our software revenue and total revenue. These agreements are typically renewed annually or semi-annually; however there is no automatic renewal provision in any of these agreements. Further, these agreements can be terminated unilaterally by Microsoft at any time. Microsoft currently offers a rebate program in conjunction with our ODA to sell Microsoft Windows Embedded operating systems in which we earn money for achieving certain predefined objectives. Under this rebate program we earned $161,000 and $343,000 for the three and six months ended June 30, 2011, respectively, and $187,000 and $353,000 for the three and six months ended June 30, 2010, respectively. These rebates are accounted for as a reduction in software cost of revenue.