Blackberry 2013 Annual Report Download - page 38

have commercial value or that will likely give the Company a technological advantage. Although the Company applies for patent
protection primarily in Canada, Europe and the United States, the Company has filed, and will continue to file, patent applications in
other countries where there exists a strategic technological or business reason to do so. To broadly protect the Company’s inventions,
the Company has a team of in-house patent attorneys and also consults with outside patent attorneys who interact with employees,
review invention disclosures and prepare patent applications on a broad array of core technologies and competencies. As a result, the
Company owns rights to an array of patented and patent pending technologies relating to wireless communication technology.
It is the Company’s general practice to enter into confidentiality and non-disclosure agreements with its employees, consultants,
contract manufacturers, customers, potential customers and others to attempt to limit access to and distribution of its proprietary
information. In addition, the Company generally enters into agreements with employees that include an assignment to the Company
of all intellectual property developed in the course of employment.
The Company also enters into various types of licensing agreements related to technology and intellectual property rights. The
Company enters certain of these agreements to obtain rights that may be necessary to produce and sell products into the wireless
industry. The Company may also license its technology and intellectual property to third parties through various licensing
agreements.
P
roduction
The Company outsources the majority of its manufacturing to specialized global Electronic Manufacturing Services (“EMS”)
companies who are positioned to meet the volumes, scale, cost and quality requirements of the Company. The Company strives to
reduce its risk and dependency on these companies by having various partners located in key geographical locations, thereby
increasing leverage on cost, quality and operational performance. Constant and immediate access to each manufacturing facility is
available upon the Company’s demand, and these facilities are regularly audited by Company personnel trained in this function. The
Company also operates a facility in Waterloo, Ontario that is approximately 242,000 square feet and is primarily focused on New
Product Introduction (“NPI”) and research and development related activities.
In the coming year, the Company expects to continue to evolve its supply chain model. The Company will also look to continue to
enhance its new product introduction and supply chain planning activities through further integration with internal research and
development activities.
The Company generally controls sourcing decisions for materials and services that are incorporated into Company products.
Outsourced manufacturing partners are responsible for transacting business on behalf of the Company with component suppliers,
but the Company generally negotiates pricing of these materials and services. Depending on market conditions, the Company may
order more or less of a particular material or service and when possible, attempts to source components from at least two suppliers
with a view to avoiding different types of supply disruption. Component availability and pricing of components may also be affected
by the volumes the Company generates, compared to the volumes a competitor may require. See
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