GE 2014 Annual Report Download - page 133

GE 2014 FORM 10-K 113
RISK FACTORS
the acquisition or disposition of a business, such as the proposed transactions and alliances with Alstom or the proposed sale
of Appliances to Electrolux, we are subject to necessary regulatory and governmental approvals on acceptable terms as well
as satisfaction of pre-closing conditions, which may prevent us from completing the transaction. Dispositions may also involve
continued financial involvement in the divested business, such as through continuing equity ownership, guarantees,
indemnities or other financial obligations. Under these arrangements, performance by the divested businesses or other
conditions outside our control could affect our future financial results.
Intellectual property - Our intellectual property portfolio may not prevent competitors from independently developing
products and services similar to or duplicative to ours.
Our patents and other intellectual property may not prevent competitors from independently developing or selling products and
services similar to or duplicative of ours, and there can be no assurance that the resources invested by us to protect our
intellectual property will be sufficient or that our intellectual property portfolio will adequately deter misappropriation or
improper use of our technology. We could also face competition in some countries where we have not invested in an
intellectual property portfolio. We also face attempts to gain unauthorized access to our IT systems or products for the purpose
of improperly acquiring our trade secrets or confidential business information. The theft or unauthorized use or publication of
our trade secrets and other confidential business information as a result of such an incident could adversely affect our
competitive position and the value of our investment in research and development. We may be unable to secure or retain
ownership or rights to use data in certain software analytics or services offerings. In addition, we may be the target of
aggressive and opportunistic enforcement of patents by third parties, including non-practicing entities. Regardless of the merit
of such claims, responding to infringement claims can be expensive and time-consuming. If GE is found to infringe any third-
party rights, we could be required to pay substantial damages or we could be enjoined from offering some of our products and
services. Also, there can be no assurances that we will be able to obtain or renew from third parties the licenses we need in
the future, and there is no assurance that such licenses can be obtained on reasonable terms.
OPERATIONAL RISKS
Operational risk relates to risks arising from systems, processes, people and external events that affect the operation of our
businesses. It includes product life cycle and execution; product safety and performance; information management and data
protection and security, including cyber security; supply chain and business disruption; and other risks, including human
resources and reputation.
Operations - We may face operational challenges that could have a material adverse effect on our business,
reputation, financial position and results of operations, and we are dependent on maintenance of existing product
lines, market acceptance of new product and service introductions and product and service innovations for
continued revenue and earnings growth.
We produce highly sophisticated products and provide specialized services for both our and third-party products that
incorporate or use leading-edge technology, including both hardware and software. While we have built extensive operational
processes to ensure that the design, manufacture and servicing of such products meet the most rigorous quality standards,
there can be no assurance that we or our customers or other third parties will not experience operational process failures or
other problems, including through cyber attacks and other intentional acts, that could result in potential product, safety,
regulatory or environmental risks. Despite the existence of crisis management or business continuity plans, operational failures
or quality issues, including as a result of organizational changes or labor relations, could have a material adverse effect on our
business, reputation, financial position and results of operations. In addition, the markets in which we operate are subject to
technological change and require skilled talent. Our long-term operating results depend substantially upon our ability to
continually develop, introduce, and market new and innovative products and services, to modify existing products and
services, to customize products and services, to respond to technological change and to execute our product and service
development in line with our projected performance and/or cost estimates.