2010 10-K: Part II Item 7. Management’s Discussion and Analysis of  Financial Condition and Results of Operations Morningstar has two operating segments: Investment Information  and Investment Management. The Investment Information segment  includes all of our data, software, and research products and services.  These products and services are typically sold through subscriptions  or license agreements. The Investment Management segment  includes our asset management operations, which operate as reg- istered investment advisors and earn more than half of their revenue  from asset-based fees. We emphasize a decentralized approach to  running our business to empower our managers and to create a  culture of responsibility and accountability. The discussion included in this section, as well as other sections of  this Annual Report on Form 10-K, contains forward-looking state- ments as that term is used in the Private Securities Litigation Reform  Act of 1995. These statements are based on our current expectations  about future events or future financial performance. Forward-looking  statements by their nature address matters that are, to different  degrees, uncertain, and often contain words such as “may,” “could,”  “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,”  “predict,” “potential,” or “continue.” These statements involve known  and unknown risks and uncertainties that may cause the events we  discuss not to occur or to differ significantly from what we expect.  For us, these risks and uncertainties include, among others, general  industry conditions and competition, including current global financial  uncertainty; the impact of market volatility on revenue from asset- based fees; damage to our reputation resulting from claims made  about possible conflicts of interest; liability for any losses that result  from an actual or claimed breach of our fiduciary duties; financial  services industry consolidation; a prolonged outage of our database  and network facilities; challenges faced by our non-U.S. operations;  and the availability of free or low-cost investment information. A more complete description of these risks and uncertainties can  be found in Item 1A—Risk Factors of this Annual Report on Form  10-K. If any of these risks and uncertainties materialize, our actual  future results may vary significantly from what we expected. We  do not undertake to update our forward-looking statements as a  result of new information or future events. All dollar and percentage comparisons, which are often accompanied  by words such as “increase,” “decrease,” “grew,” “declined,” “was  up,” “was down,” “was flat,” or “was similar” refer to a comparison  with the same period in the prior year unless otherwise stated. Our mission is to create great products that help investors reach  their financial goals. We offer an extensive line of data, software,  and research products for individual investors, financial advisors,  and institutional clients. We also offer asset management services  for advisors, institutions, and retirement plan participants. Many  of our products are sold through subscriptions or license agreements.  As a result, we typically generate recurring revenue. For some of our other institutional services, mainly Investment  Consulting, we generally base our fees on the scope of work and  the level of service we provide and calculate them as a percentage  of assets under advisement. We also earn fees relating to  Morningstar Managed Portfolios and the managed retirement  accounts offered through Morningstar Retirement Manager and  Advice by Ibbotson that we calculate as a percentage of assets  We generate revenue by selling a variety of investment-related  products and services. We sell many of our offerings, such as news- letters, Principia software, and Premium service on Morningstar. com, via subscriptions. These subscriptions are mainly offered for  a one-year term, although we also offer terms ranging from one  month to three years. We also sell advertising on our websites  throughout the world. Several of our other products are sold through  license agreements, including Morningstar Advisor Workstation,  Morningstar Equity Research, Morningstar Direct, Retirement Advice,  and Licensed Data. Our license agreements typically range from  one to three years. Historically, we have focused primarily on organic growth by intro- ducing new products and services and marketing our existing prod- ucts. However, we have made and expect to continue to make  selective acquisitions that support our five key growth strategies,  which are: Key Business Characteristics Revenue Understanding Our Company U  Enhance our position in key market segments by focusing on our  three major Internet-based platforms; U  Create a premier global investment database; U  Continue building thought leadership in independent  investment research; U  Become a global leader in fund-of-funds investment  management; and U  Expand our international brand presence, products, and services. 62