iRobot 2011 Annual Report Download - page 57

Our competitors include developers of robot floor cleaning products, developers of small unmanned ground
vehicles, established government contractors working on unmanned systems, and developers of small unmanned
underwater vehicles.
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 provide assurance 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 31, 2011, we held 97 U.S. patents and more than 175 pending U.S. patent applications.
Also, we held 108 foreign patents, additional design registrations, and more than 100 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,
FasTac, Aware, Home Base, Looj, Verro, Virtual Wall, and Warrior. 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
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