Motorola 2011 Annual Report Download - page 13

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7
patent portfolio will continue to provide us with a competitive advantage in our core product areas. Furthermore,
we believe we are not dependent upon a single patent or a few patents. Our success depends more upon our
proprietary know-how, innovative skills, technical competence and marketing abilities. In addition, because of
changing technology, our present intention is not to rely primarily on patents or other intellectual property rights to
protect or establish our market position. However, we plan to continue to litigate against competitors to enforce our
intellectual property rights in certain technologies when attempts to negotiate mutually agreeable licenses are not
successful.
Patents and Trademarks
As of December 31, 2011, we owned approximately 6,013 patents in the U.S. and in foreign countries. As of
December 31, 2011, we and our wholly owned subsidiaries had approximately 2,700 U.S. and foreign patent
applications pending. These foreign patents and patent applications are mostly counterparts of our U.S. patents.
During 2011, we and our wholly owned subsidiaries were granted 237 U.S. patents and 314 patents in other
countries.
Inventory, Raw Materials, Right of Return and Seasonality
Our practice is to carry reasonable amounts of inventory to meet customers’ delivery requirements in a manner
consistent with industry standards. We provide custom products which require the stocking of inventories and large
varieties of piece parts and replacement parts in order to meet delivery and warranty requirements. To the extent
our suppliers’ product life cycles are shorter than ours, stocking of lifetime-buy inventories is required to meet long-
term warranty and contractual requirements. In addition, replacement parts are stocked for delivery on customer
demand within a short delivery cycle. At December 31, 2011, our inventory balance decreased slightly compared to
December 31, 2010.
Availability of materials and components required by the Company is generally dependable; however,
fluctuations in supply and market demand have caused and could cause selective shortages and affect results. We
currently procure certain materials and components from single-source vendors. A material disruption from a single-
source vendor may have a material adverse impact on our results of operations. If certain single-source suppliers
were to become capacity constrained or insolvent, it could result in a reduction or interruption in supplies or an
increase in the price of supplies and adversely impact our financial results.
Natural gas, electricity and, to a lesser extent, oil are the primary sources of energy for our manufacturing
operations. Each of these resources is currently in adequate supply for our operations. In addition, the cost to
operate our facilities and freight costs are dependent on world oil prices. Labor is generally available in reasonable
proximity to our manufacturing facilities. Difficulties in obtaining any of the aforementioned resources or a
significant cost increase could affect our financial results.
Generally, our customer contracts do not include a right of return, other than for standard warranty provisions;
however, certain distributor partners within the commercial enterprise markets do maintain limited stock rotation
rights. Due to buying patterns in the markets we serve, sales tend to be somewhat higher in the fourth quarter.
Environmental Quality
During 2011, compliance with federal, state and local laws regulating the discharge of materials into the
environment, or otherwise relating to the protection of the environment, did not have a material effect on our
capital expenditures, earnings or the competitive position of the Company.
Employees
At December 31, 2011, we and our subsidiaries had approximately 23,000 employees, compared to
51,000 employees at December 31, 2010. Approximately 19,000 employees transferred as part of the distribution of
Motorola Mobility on January 4, 2011, and approximately 7,000 employees transferred with the sale of certain
assets and liabilities of the Networks business to NSN.
Available Information
We make available free of charge through our website, www.motorolasolutions.com/investor, our annual
reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements, other