Boeing 2011 Annual Report Download - page 15

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Intellectual Property
We own numerous patents and have licenses for the use of patents owned by others, which relate to
our products and their manufacture. In addition to owning a large portfolio of intellectual property, we
also license intellectual property to and from third parties. For example, the U.S. government has
licenses in our patents that are developed in performance of government contracts, and it may use or
authorize others to use the inventions covered by such patents for government purposes. Unpatented
research, development and engineering skills, as well as certain trademarks, trade secrets, and other
intellectual property rights, also make an important contribution to our business. While our intellectual
property rights in the aggregate are important to the operation of each of our businesses, we do not
believe that our business would be materially affected by the expiration of any particular intellectual
property right or termination of any particular intellectual property patent license agreement.
Non-U.S. Revenues
See Note 22 to our Consolidated Financial Statements for information regarding non-U.S. revenues.
Research and Development
Research and development expenditures involve experimentation, design, development and related
test activities for defense systems, new and derivative jet aircraft including both commercial and
military, advanced space and other company-sponsored product development. These are expensed as
incurred including amounts allocable as reimbursable overhead costs on U.S. government contracts.
Our total research and development expense amounted to $3.9 billion, $4.1 billion and $6.5 billion in
2011, 2010 and 2009, respectively. Research and development expense in 2009 included $2.7 billion
of production costs related to the first three flight test 787 aircraft that cannot be sold due to the
inordinate amount of rework and unique and extensive modifications that would be made to the aircraft.
Research and development costs also include bid and proposal efforts related to government products
and services, as well as costs incurred in excess of amounts estimated to be recoverable under cost-
sharing research and development agreements. Bid and proposal costs were $332 million, $355 million
and $343 million in 2011, 2010 and 2009, respectively.
Research and development highlights for each of the major business segments are discussed in more
detail in Segment Results of Operations and Financial Condition on pages 23 – 38.
Employees
Total workforce level at December 31, 2011 was approximately 171,700.
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