Dell 2009 Annual Report Download - page 12

Table of Contents
From time to time, other companies and individuals assert exclusive patent, copyright, trademark, or other intellectual property rights to
technologies or marks that are important to the technology industry or our business. We evaluate each claim relating to our products and,
if appropriate, seek a license to use the protected technology. The licensing agreements generally do not require the licensor to assist us in
duplicating its patented technology, nor do these agreements protect us from trade secret, copyright, or other violations by us or our
suppliers in developing or selling these products.
Government Regulation and Sustainability
• Government Regulation
Our business is subject to regulation by various federal and state governmental agencies. Such regulation includes the radio
frequency emission regulatory activities of the U.S. Federal Communications Commission; the anti-trust regulatory activities of
the U.S. Federal Trade Commission, the U.S. Department of Justice, and the European Union; the consumer protection laws and
financial services regulations of the U.S. Federal Trade Commission and various state governmental agencies; the export
regulatory activities of the U.S. Department of Commerce and the U.S. Department of Treasury; the import regulatory activities
of U.S. Customs and Border Protection; the product safety regulatory activities of the U.S. Consumer Product Safety
Commission; the investor protection and capital markets regulatory activities of the Securities and Exchange Commission; and
the environmental, employment and labor, and other regulatory activities of a variety of governmental authorities in each of the
countries in which we conduct business. We were not assessed any material environmental fines, nor did we have any material
environmental remediation or other environmental costs, during Fiscal 2010.
• Sustainability
Environmental stewardship and social responsibility are both integral parts of how we manage our business, and complement
our focus on business efficiencies and customer satisfaction. We use open dialogue with our stockholders, customers, vendors,
and other stakeholders as part of our sustainability governance process where we take candid feedback and offer honest
discussions on the challenges we face globally. Our environmental initiatives take many forms, including maximizing product
energy efficiency, reducing and eliminating sensitive materials from our products, and providing responsible, convenient
computer recycling options for customers.
We are committed to becoming carbon neutral in our operations. We have set business requirements for our suppliers to
disclose and reduce their greenhouse gas, or "GHG," impacts. We were the first company in our industry to offer a free
worldwide recycling program for our consumers. We also provide consumers with no-charge recycling of any brand of
computer or printer with the purchase of a new Dell computer or printer. We have streamlined our transportation network to
reduce transit times, minimize air freight and reduce emissions. Our packaging is designed to minimize box size and to increase
recycled content of materials along with recyclability. When developing and designing products, we select materials guided by
a precautionary approach in which we seek to eliminate environmentally sensitive substances (where reasonable alternatives
exist) from our products and work towards developing reliable, environmentally sound, and commercially scalable solutions.
We also have created a series of tools that help customers assess their current IT operations and uncover ways to reduce both
the costs of those operations and their impact on the environment.
Backlog
We believe that backlog is not a meaningful indicator of net revenue that can be expected for any period. The backlog at any point in time
may not translate into net revenue in any subsequent period, as unfilled orders can generally be canceled at any time by the customer. Our
business model generally gives us flexibility to manage backlog at any point in time by expediting shipping or prioritizing customer
orders toward products that have shorter lead times, thereby reducing backlog and increasing current period revenue. Although backlog at
the end of Fiscal 2010 was higher than at the end of Fiscal 2009 and Fiscal 2008, the difference was not material when compared to our
annual revenue during Fiscal 2010.
8