Memorex 2013 Annual Report Download - page 6

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mainly on retail channels; and Tiered Storage and Security Solutions (TSS), which focuses on small and medium business,
enterprise and government customers. See further discussion of our new business segments below.
In October 2012, the Board of Directors approved our Global Process Improvement Restructuring Program (GPI
Program) in order to realign our business structure and reduce operating expenses in excess of 25 percent over time. This
restructuring program addressed product line rationalization and infrastructure and included a planned reduction in our global
workforce. The majority of these actions were implemented during 2013. As of December 31, 2013 we have reduced
operating expenses by approximately 30 percent, not considering the incremental operating expense from the acquisition of
Nexsan, and we have reduced our global workforce by over 20 percent under the GPI Program.
See Note 7 — Restructuring and Other Expense in our Notes to Consolidated Financial Statements for more information
on the GPI Program.
Our Products
We have four major product categories: Consumer storage media and Audio and accessories in our CSA business unit
and Storage and security solutions and Commercial storage media in our TSS business unit.
Consumer Storage Media
Our consumer storage media includes optical products, USB flash drives, flash cards and external hard disk drives. Our
optical products consist of DVDs, CDs and Blu-ray™ recordable media. We have the leading global market share for
recordable optical media; however, the overall market for CDs and DVDs is declining as digital streaming, hard disk and flash
media replace optical media in some applications such as music and video recording. Our recordable optical media products
are sold through a variety of retail and commercial distribution channels and sourced from manufacturers in Taiwan and India.
Optical storage capacities range from 700 megabyte (MB) CD-R (recordable) and CD-RW (rewritable) optical discs to 8.5 GB
dual layer DVD optical discs and Blu-ray discs with 25 GB to 100 GB of capacity. Our optical media is sold throughout the
world under brands we own or control, including Imation, Memorex and TDK Life on Record. We also sell standard USB flash
drives, flash cards and external hard disk drives throughout the world under our Imation, Memorex and TDK Life on Record
brands. We source these products from manufacturers primarily in Asia and sell them through a variety of retail and
commercial distribution channels around the world. USB flash drives have capacities ranging from 2 GB up to 128 GB and
capacities continue to increase as new products are introduced. External hard disk drives have capacities ranging from
500 GB to 2 TB.
Audio and Accessories
Our audio and accessories products include headphones and speakers sold under the TDK Life on Record brand. The
portfolio continues to evolve as we focus on higher-margin, differentiated accessories products and respond to customer
demand. We design products to meet user needs and source these products from manufacturers throughout Asia.
Storage and Security Solutions
Our storage systems portfolio ranges from high volume, dense storage products to innovative unified hybrid storage
solutions. This includes Nexsan E-Series™ disk arrays with industry-leading storage density, reliability and power
management targeting the block-based storage market; the NST®line of hybrid storage combining solid state technology with
spinning disk to offer high performance and capacity and the Assureon®secure archive systems for data offload, compliance
and secure cloud deployments. This robust product family addresses the most important parts of the data storage market and
is delivered globally.
The mobile security family delivers innovative secure data solutions for corporate employees who need to protect
information on the go and targets organizations that require highly secure solutions in a Bring Your Own Device (BYOD)
environment. Products and services include secure storage products, software and portable workspace solutions such as
3