SanDisk 2013 Annual Report Download - page 107

insufficient to cover these costs. The non-equity investments in Flash Ventures are shared equally between
us and Toshiba. We and Toshiba also collaborate on joint R&D activities.
Competition
We face competition from flash memory manufacturers, as well as manufacturers and resellers of
products that incorporate flash memory.
We believe that our ability to compete successfully depends on a number of factors, including:
• product performance, reliability and differentiation;
• price, quality and availability of products;
• success in developing new products, applications and markets;
• timing of new product announcements and successful introductions;
• sufficient availability of cost-efficient supply;
• creation and monetization of IP and the development of industry standards and formats;
• the number and nature of competitors in a given market; and
• general market and economic conditions.
We believe our key competitive advantages are:
• our strong history of technological innovation and standards creation, which enables us to grow the
overall market for flash storage solutions;
• our vertically integrated business model, including our investment in Flash Ventures, which provides
us with leading-edge, low-cost NAND flash;
• we are the only pure play NAND flash storage solutions provider, which strengthens our focus on
NAND technology and solutions;
• our IP ownership, in particular our patents, and multi-level cell, or MLC, manufacturing know-how,
which provides us with license and royalty revenue as well as cost advantages;
• our system expertise in controller and firmware development;
• that we market and sell a broad range of flash storage products, which gives us an advantage in
obtaining strong retail and commercial distribution;
• that we have global retail distribution for our products and worldwide leading market share in
removable flash cards and USB flash drives;
• that we have a well-recognized and trusted brand; and
• our strong financial position.
Our competitors include:
•NAND Manufacturers. We compete with NAND flash memory manufacturers, including Hynix,
Intel, Micron Technology, Inc., or Micron, Samsung and Toshiba. These companies compete with us
in selling a range of flash-based products and form factors, including embedded, solid state drives,
removable and other form factors. We compete with these NAND flash memory manufacturers
based upon technology and advanced wafer manufacturing processes which influence cost,
performance, and quality of the flash memory. We further compete based upon the system
technology in our solutions and the branding of our solutions.
•Flash Memory Card and USB Drive Manufacturers and Resellers. We compete with manufacturers
and resellers of flash memory card and USB drives, which purchase or have a captive supply of flash
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