Dow Chemical 2011 Annual Report Download - page 45

11
Method of Distribution
All products and services are marketed primarily through the Company’s sales force, although in some instances more
emphasis is placed on sales through distributors.
Fourteen percent of the sales of the Feedstocks and Energy segment in 2011 were to one customer with which the
Company has ongoing supply contracts. Other than sales to this customer, no significant portion of the business of any
operating segment is dependent upon a single customer.
No single product accounted for more than 5 percent of the Company’s consolidated net sales in 2011.
Research and Development
The Company is engaged in a continuous program of basic and applied research to develop new products and processes, to
improve and refine existing products and processes, and to develop new applications for existing products. Research and
development expenses were $1,646 million in 2011, $1,660 million in 2010 and $1,492 million in 2009. At December 31, 2011,
the Company employed approximately 6,300 people in various research and development activities.
Patents, Licenses and Trademarks
The Company continually applies for and obtains U.S. and foreign patents and has a substantial number of pending patent
applications throughout the world. At December 31, 2011, the Company owned 3,546 active U.S. patents and 14,574 active
foreign patents as follows:
Patents Owned at December 31, 2011
Electronic and Functional Materials
Coatings and Infrastructure Solutions
Agricultural Sciences
Performance Materials
Performance Plastics
Feedstocks and Energy
Corporate
Total
United
States
927
630
556
548
678
34
173
3,546
Foreign
3,006
3,027
1,983
2,683
3,199
211
465
14,574
Remaining Life of Patents Owned at December 31, 2011
Within 5 years
6 to 10 years
11 to 15 years
16 to 20 years
Total
United
States
919
1,154
961
512
3,546
Foreign
2,694
5,469
5,055
1,356
14,574
Dow’s primary purpose in obtaining patents is to protect the results of its research for use in operations and licensing. Dow
is also party to a substantial number of patent licenses and other technology agreements. The Company had revenue related to
patent and technology royalties totaling $437 million in 2011, $191 million in 2010 and $269 million in 2009. The Company
incurred royalties to others of $114 million in 2011, $111 million in 2010 and $102 million in 2009. Dow also has a substantial
number of trademarks and trademark registrations in the United States and in other countries, including the “Dow in Diamond”
trademark. Although the Company considers that its patents, licenses and trademarks in the aggregate constitute a valuable
asset, it does not regard its business as being materially dependent on any single or group of related patents, licenses or
trademarks.