Autodesk 2011 Annual Report Download - page 76

COMPETITION
The markets for our products are highly competitive and subject to rapid change. We strive to increase our
competitive separation by investing in research and development, allowing us to bring new products to market
and create exciting new versions of existing products that offer compelling efficiencies for our customers. We
also compete through investments in marketing and sales to more effectively reach new customers and better
serve existing customers.
Our competitors range from large, global, publicly traded companies to small, geographically focused firms
to solutions produced in-house by their users. Our primary global competitors in these segments include Adobe
Systems Incorporated, ANSYS, Inc., Bentley Systems, Incorporated, Dassault Systèmes S.A. and its subsidiary
Dassault Systèmes SolidWorks Corp., Environmental Systems Research Institute, Inc. (ESRI), Google Inc.,
Intergraph Corporation, a wholly owned subsidiary of Hexagon AB, Nemetschek AG, Parametric Technology
Corporation, and Siemens Product Lifecycle Software, Inc.
Our M&E segment also competes with a wide range of different companies from large, global, publicly-
traded companies to small private entities. Large organizations that produce products that compete in some or all
of our markets include Adobe Systems Incorporated, Apple Inc., Avid Technology, Inc., SONY Corporation and
Thomson. The media and entertainment market is highly fragmented with complex interdependencies between
many of the larger businesses. As a result, some of our competitors also own subsidiaries that are our customers
or our partners in developing or bringing to market some of our solutions. In addition to traditional competitors
in developed economies, we encounter new competitors in emerging economies.
The software industry has limited barriers to entry, and the availability of computing power with continually
expanding performance at progressively lower prices contributes to the ease of market entry. The design software
market is characterized by vigorous competition in each of the vertical markets in which we compete, both from
existing competitors and by entry of competitors with innovative technologies. Competition is increasingly
enhanced by consolidation of companies with complementary products and technologies and the possibility that
competitors in one vertical segment may enter other vertical segments that we serve. In addition, some of our
competitors in certain markets have greater financial, technical, sales and marketing and other resources than we
do. Because of these and other factors, competitive conditions in these industries are likely to continue to
intensify in the future. Increased competition could result in price reductions, reduced net revenue and profit
margins and loss of market share, any of which could harm our business. See Item 1A, “Risk Factors,” for further
discussion of risks regarding competition.
We believe that our future results depend largely upon our abilities to better serve customers by offering
new products, whether by internal development or acquisition, and to continue to provide existing product
offerings that compete favorably with respect to ease of use, reliability, performance, range of useful features,
continuing product enhancements, reputation, price and training.
INTELLECTUAL PROPERTY AND LICENSES
We maintain an active program to legally protect our investment in technology through intellectual property
rights. We protect our intellectual property through a combination of patent, copyright, trademark and trade
secret protections, confidentiality procedures and contractual provisions. The nature and extent of legal
protection associated with each such intellectual property right depends on, among other things, the type of
intellectual property right and the given jurisdiction in which such right arises. We believe that our intellectual
property rights are valuable and important to our business, including each of our segments.
Nonetheless, our intellectual property rights may not be successfully asserted in the future or may be
invalidated, circumvented or challenged. In addition, the laws of various foreign countries where our products are
distributed do not protect our intellectual property rights to the same extent as U.S. laws. Enforcement of
intellectual property rights against alleged infringers can sometimes lead to costly litigation and counterclaims.
Our inability to protect our proprietary information could harm our business.
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