iRobot 2008 Annual Report Download - page 63

• developers of small unmanned ground vehicles such as Foster-Miller, Inc. — a wholly owned subsidiary of
QinetiQ North America, Inc., Allen-Vanguard Corporation, and Remotec — a division of Northrop
Grumman Corporation; and
• established government contractors working on unmanned systems such as Lockheed Martin Corporation,
The Boeing Company, BAE Systems, Inc. and General Dynamics Corporation.
While we believe many of our customers purchase our Roomba floor vacuuming robots and Scooba floor
washing robots as a supplement to, rather than a replacement for, their traditional vacuum cleaners and wet floor
cleaning methods, we do compete in some cases with providers of traditional cleaning products.
We believe that the principal competitive factors in the market for robots include product features, performance
for the intended mission, cost of purchase, total cost of system operation, including maintenance and support, ease of
use, integration with existing equipment, quality, reliability, customer support, brand and reputation.
Our ability to remain competitive will depend to a great extent upon our ongoing performance in the areas of
product development and customer support. We cannot assure you that our products will continue to compete
favorably or that we will be successful in the face of increasing competition from new products and enhancements
introduced by existing competitors or new companies entering the markets in which we provide products.
Intellectual Property
We believe that our continued success depends in large part on our proprietary technology, the intellectual
skills of our employees and the ability of our employees to continue to innovate. We rely on a combination of patent,
copyright, trademark and trade secret laws, as well as confidentiality agreements, to establish and protect our
proprietary rights.
As of December 27, 2008, we held 52 U.S. patents and more than 130 pending U.S. patent applications. Also,
we held 15 foreign patents, additional design registrations, and more than 60 pending foreign applications. Our
U.S. patents will begin to expire in 2019. We will continue to file and prosecute patent (or design registration, as
applicable) applications when and where appropriate to attempt to protect our rights in our proprietary technologies.
We also encourage our employees to continue to invent and develop new technologies so as to maintain our
competitiveness in the marketplace. It is possible that our current patents, or patents which we may later acquire,
may be successfully challenged or invalidated in whole or in part. It is also possible that we may not obtain issued
patents for our pending patent applications or other inventions we seek to protect. In that regard, we sometimes
permit certain intellectual property to lapse or go abandoned under appropriate circumstances and due to
uncertainties inherent in prosecuting patent applications, sometimes patent applications are rejected and we
subsequently abandon them. It is also possible that we may not develop proprietary products or technologies in the
future that are patentable, or that any patent issued to us may not provide us with any competitive advantages, or that
the patents of others will harm or altogether preclude our ability to do business.
Our registered U.S. trademarks include iRobot, Roomba, Scooba, iRobot Dirt Dog, Create, PackBot, Home
Base, Verro and Virtual Wall. Our marks, iRobot, Roomba, Scooba, and certain other trademarks, have also been
registered in selected foreign countries.
Our means of protecting our proprietary rights may not be adequate and our competitors may independently
develop technology that is similar to ours. Legal protections afford only limited protection for our technology. The
laws of many countries do not protect our proprietary rights to as great an extent as do the laws of the United States.
Despite our efforts to protect our proprietary rights, unauthorized parties have in the past attempted, and may in the
future attempt, to copy aspects of our products or to obtain and use information that we regard as proprietary. Third
parties may also design around our proprietary rights, which may render our protected products less valuable, if the
design around is favorably received in the marketplace. In addition, if any of our products or the technology
underlying our products is covered by third-party patents or other intellectual property rights, we could be subject to
various legal actions. We cannot assure you that our products do not infringe patents held by others or that they will
not in the future. We have received in the past communications from third parties relating to technologies used in our
Roomba floor vacuuming robots that have alleged infringement of patents or violation of other intellectual property
rights. In response to these communications, we have contacted these third parties to convey our good faith belief
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Form 10-K