Symantec 2004 Annual Report Download - page 26

«24»SYMANTEC CORPORATION
Some of our existing and potential competitors have greater
financial, marketing or technological resources than we do.
We believe that competition in the industry will continue to
intensify as other major software companies expand their product
lines into additional product categories, and as operating system
providers, network equipment and computer hardware manufacturers
attempt to leverage their strengths at the computing platform,
security layer and network tier to compete more aggressively in
the market for security solutions.
Manufacturing
Our product development groups produce a set of master
CD-ROMs or diskettes and documentation for each product that is
then duplicated or replicated and packaged into products by our
logistics organization. United States purchasing of all raw materials
is done by an outside organization. This outside contractor,
under the supervision of our domestic logistics organization,
performs all of our domestic manufacturing and order fulfillment.
The manufacturing steps that are subcontracted to outside
organizations include the replication of CD-ROMs, printing
of documentation materials and retail boxes, and assembly of
the final packages. Purchasing is done by Symantec personnel
for products manufactured in our Dublin, Ireland facilities. For
most products distributed outside of North and South America,
our Dublin, Ireland manufacturing facility performs diskette
duplication, assembly of the final packages, and order fulfillment.
Our Dublin, Ireland manufacturing facility also subcontracts to
outside organizations for the replication of CD-ROMs and printing
of documentation materials and retail boxes.
Intellectual Property
We regard our software as proprietary. We attempt to protect our
software technology by relying on a combination of copyright,
patent, trade secret and trademark laws, restrictions on disclosure
and other methods. In particular, we have a substantial number
of registered trademarks and currently hold a substantial number
of patents in the United States, as well as patent holdings in
other countries, which expire at various times over the next 20
years. We regularly file other applications for patents and trade-
marks in order to protect proprietary intellectual property that
we believe are important to our business. We also license some
intellectual property from third parties for use in our products.
We face a number of risks relating to our intellectual property,
including unauthorized use and unauthorized copying, or piracy,
of our software solutions. Litigation may be necessary to enforce
our intellectual property rights, to protect trade secrets or trade-
marks or to determine the validity and scope of the proprietary
rights of others. Patents that have been issued to us could be
determined to be invalid and may not be enforceable against
competitive products in every jurisdiction. Furthermore, other
parties have asserted and may, in the future, assert infringement
claims against us. These claims and any litigation may result
in invalidation of our proprietary rights. Litigation, even if not
meritorious, could result in substantial costs and diversion of
resources and management attention. In addition, third party
licenses may not continue to be available to us on commercially
acceptable terms, or at all.
Employees
As of March 31, 2004, we employed approximately 5,300 people
worldwide, including approximately 2,800 in sales, marketing
and related staff activities (with approximately 800 employees
in our direct sales force), 1,300 in product development, 300 in
services and 900 in management, manufacturing, administration
and finance. In connection with the relocation of our Leiden,
Netherlands operations to Dublin, Ireland in early fiscal year 2003,
a group of employees in the Leiden facility joined a union
to negotiate the proposed terms of the transfer of operations to
our Dublin facility, focusing primarily on severance benefits
for employees that did not relocate to Dublin. Except for these
terminated employees, no other employees are represented by a
labor union. We believe that relations with our employees are good.
Properties
Our principal administrative, sales and marketing facilities are
located in Cupertino, California. We lease a number of additional
facilities for administrative, marketing, research and development,
and technical support in the United States, China, Ireland, Japan,
the Netherlands, New Zealand, and Taiwan.
2004 Annual Report