−Removed: Dolby Laboratories creates audio and imaging technologies that transform entertainment and communications for content playback in movies, TV, music, and gaming.
+Added: Dolby Laboratories creates audio and imaging technologies that transform entertainment for content playback in movies, TV, music, gaming and user-generated content.
Founded in 1965, our strengths stem from expertise in analog and digital signal processing and digital compression technologies that have transformed the ability of artists to convey entertainment experiences to their audiences through recorded media.
−Removed: Such technologies led to the development of our noise-reduction systems for analog tape recordings, and have since evolved into multiple offerings that enable more immersive sound for cinema, DTV transmissions and devices, mobile devices, OTT video and music services, and home entertainment devices.
+Added: Such technologies led to the development of our noise-reduction systems for analog tape recordings, and have since evolved into multiple offerings that enable more immersive sound for cinema, DTV transmissions and devices, mobile devices, OTT video and music services, home entertainment devices, and automobiles.
Today, we derive the majority of our revenue from licensing our audio technologies.
We also derive revenue from licensing our consumer imaging technologies, as well as audio and imaging technologies for premium cinema offerings in collaboration with exhibitors.
−Removed: In addition, we provide products and services for a variety of applications in the cinema and broadcast markets, and offer audio and video APIs through our developer platform, Dolby.io.
−Removed: Please refer to the Executive Summary section of Part II, Item 7 " Management's Discussion and Analysis of Financial Condition and Results of Operations " for information concerning the continuing effect of COVID-19 on our business.
+Added: In addition to our licensing business, we provide products and services for a variety of applications in the cinema and broadcast markets, and offer solutions to companies building real-time digital experiences that increase audience engagement.
Key elements of our strategy include:
Advancing the Science of Sight and Sound.
−Removed: We apply our understanding of the human senses, audio, and imaging engineering to develop technologies aimed at improving how people experience and interact with their entertainment and communications content.
+Added: We apply our understanding of the human senses, audio, and imaging engineering to develop technologies aimed at improving how people experience and interact with their entertainment content.
Providing Creative Solutions.
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Delivering Superior Experiences.
−Removed: Our technologies and solutions optimize playback and communications so that users may enjoy richer, clearer, and more immersive sound and sight experiences.
+Added: Our technologies and solutions optimize playback so that users may enjoy richer, clearer, and more immersive sound and sight experiences.
Expanding the Reach of our Technologies .
−Removed: With the launch of our developer platform, Dolby.io, we are expanding our addressable market to enhance a broader range of content, by enabling developers to build high quality, interactive, and media centric applications.
+Added: We look for new and innovative ways to expand the reach of our technologies to new content, media, devices and audiences.
+Added: For example, we are expanding our addressable market to enhance a broader range of content, by offering solutions to companies building real-time digital experiences that increase audience engagement.
+Added: Our solution provides the capability to stream high quality audiovisual content in ultra-low latency which reduces the delay between the action and the viewer.
+Added: Everyone experiencing the action at the same time enables ways to interact with the content.
REVENUE GENERATION
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Technology Description
−Removed: AAC, HE-AAC & Extended HE-AAC Advanced digital audio codec solutions with high bandwidth efficiency used for a wide range of media applications.
+Added: AAC, HE-AAC and Extended HE-AAC Advanced digital audio codec solutions with high bandwidth efficiency used for a wide range of media applications.
AVC A digital video codec with high bandwidth efficiency used in a wide range of media devices.
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DD A digital audio coding technology that provides multichannel sound to a variety of media applications.
−Removed: DD+ An advanced digital audio coding technology that offers more efficient audio transmission for a wide range of media applications and devices.
+Added: An advanced digital audio coding technology that offers more efficient audio transmission for a wide range of media applications and devices.
Dolby TrueHD A digital audio coding technology providing lossless encoding for premium quality media applications.
Dolby Vision An imaging technology combining high dynamic range and dynamic metadata to deliver ultra vivid colors, sharper contrasts, and richer details for cinema and a wide range of media devices.
−Removed: Dolby Voice® An audio communications technology with superior spatial perception, voice clarity, and background noise reduction that emulates the in-person meeting experience.
HEVC A digital video codec with high bandwidth efficiency to support ultra-high definition experiences for a wide range of media devices.
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2022 September 24,
−Removed: 2020 Main Offerings Incorporating Our Technologies
+Added: 2021 Main Components of Each Category
Broadcast 38% 37% 39% Televisions and STBs
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CE 14% 16% 15% DMAs, Blu-ray Disc devices, AVRs, Soundbars, and DVDs
−Removed: PC 13% 12% 12% Windows and macOS operating systems
−Removed: Other 13% 12% 12% Gaming consoles, Auto DVD, and Dolby Cinema
+Added: PC 10% 13% 12% Windows and macOS operating systems and devices
+Added: Other 18% 13% 12% Dolby Cinema, Gaming consoles, Automotive, and Patent pool administrative services
Total 100% 100% 100%
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For the use of our technologies, our system licensees pay an initial licensing fee as well as royalties, which represent the majority of the revenue recognized from these arrangements.
−Removed: The amount of royalties we collect on a particular product depends on several factors including the nature of the implementations, the mix of Dolby technologies used, and the volume of products using our technologies that are shipped by the system licensee.
+Added: The amount of royalties we collect on a particular product depends on several factors including the nature of the implementation, the mix of Dolby technologies used, and the volume of products using our technologies that are shipped by the system licensee.
Integrated Licensing Model .
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Patent Licensing Model.
−Removed: We license our patents through patent pools which are arrangements between multiple patent owners to jointly offer and license pooled patents to licensees.
−Removed: We also license our patents directly to manufacturers that use our IP in their products.
−Removed: Finally, we generate service fees for managing patent pools on behalf of third party patent owners through our wholly-owned subsidiary, Via Licensing Corporation ("Via").
−Removed: By aggregating and offering pooled IP, patent pools deliver efficiencies that reduce transactional costs for both IP owners and licensees.
−Removed: The Via patent pools enable product manufacturers to efficiently and transparently secure patent licenses for collaboratively developed technologies.
−Removed: We offer our patents related to AAC, HE-AAC, Extended HE-AAC, AVC, HEVC, and other IP through a combination of patent pools and licensing directly to OEMs.
+Added: We license our patents directly to manufacturers that use our IP in their products.
+Added: We also license our patents through patent pools which are arrangements between multiple patent owners to jointly offer and license pooled patents to licensees who use our IP in their products.
+Added: By aggregating and offering pooled patents, these arrangements deliver efficiencies that reduce transactional costs for both IP owners and licensees.
+Added: Patent pools enable product manufacturers to efficiently and transparently secure patent licenses for collaboratively developed technologies.
+Added: We offer our patents related to AAC, HE-AAC, Extended HE-AAC, AVC, HEVC, VVC and other standardized technologies through a combination of patent pools and licensing directly to OEMs.
+Added: Finally, Via LA (as defined below) generates fees for administering patent pools on behalf of third party patent owners.
+Added: See Note 15 " Business Combinations " to our consolidated financial statements for a description of the recent business combination involving Via LA.
Licensing revenue recognized in any given period may include revenue from licensees and/or settlements with third parties where the use of our technology occurred in previous periods.
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Cinema Cinema Imaging Products Digital Cinema Servers used to load, store, decrypt, decode, watermark, and playback digital film files for presentation on digital cinema projectors and software used to encrypt, encode, and package digital media files for distribution
−Removed: Cinema Audio Products Cinema Processors, amplifiers, and loudspeakers used to decode, render, and optimally playback digital cinema soundtracks, including those using Dolby Atmos
−Removed: Other Other Products 3-D glasses and kits, broadcast hardware and software used to encode, transmit, and decode multiple channels of high-quality audio for DTV and HDTV distribution, monitors, accessibility solutions for hearing and visually impaired consumers, and Dolby.io
−Removed: We offer a developer platform, Dolby.io, that enables developers access to our technologies through APIs.
−Removed: These offerings currently include audio and video APIs for building high-quality communications, media, and streaming solutions.
+Added: Cinema Audio Products Cinema Processors, amplifiers, and loudspeakers used to decode, render, and optimally play back digital cinema soundtracks, including those using Dolby Atmos
+Added: Other Other Products 3-D glasses and kits, broadcast hardware and software used to encode, transmit, and decode multiple channels of high-quality audio for DTV and HDTV distribution, monitors, and accessibility solutions for hearing and visually impaired consumers
+Added: We offer solutions to companies building real-time digital experiences that increase audience engagement.
Over time, we expect to significantly expand the amount and types of content that can be enhanced through our technologies and capabilities.
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As of September 29, 2023, we had approximately 19,300 issued patents and approximately 1,900 pending patent applications in more than 100 jurisdictions throughout the world.
−Removed: Our currently issued patents expire at various times through December 2046.
+Added: Our currently issued patents expire at various times through September 2045.
Some of our patents relating to DD technologies have expired, and others will expire over the next several years.
While in the past we derived a significant portion of our licensing revenue from our DD technologies, this is no longer the case as revenue attributed to DD technologies has declined and is expected to continue to decline.
−Removed: The primary products where DD is widely used include DVD players (but not Blu-ray players), TVs, and STBs.
+Added: The primary products where DD is widely used include automotive, TVs, and soundbars.
We have transitioned a number of our DD licensees to DD+ technologies, an extension of our DD technologies, whose patents generally expire later than the DD patents.
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Moreover, in certain countries, we have relatively few or no issued patents.
−Removed: For example, in China, Taiwan, and India, we have only limited patent protection for our Dolby technologies.
+Added: For example, in some African and Central and South American countries, we have only limited patent protection for our technologies.
Consequently, we may realize less revenue from those regions in the future.
−Removed: Maintaining or growing our licensing revenue in developing countries such as China, Taiwan, and India will depend in part on our ability to obtain patent rights in these countries, which is uncertain.
+Added: Maintaining or growing our licensing revenue in developing countries will depend in part on whether we obtain patent rights in those countries, which is uncertain.
Further, because of the limitations of the legal systems in many countries, the effectiveness of patents obtained or that may in the future be obtained is uncertain.
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• DD is mandated for HD broadcast in multiple regions including North America and South Korea, and for DVD players on a global basis.
−Removed: • AC-4 is Dolby’s next generation of audio coding technology that has been adopted for implementation in certain regions by worldwide standards organizations including the DVB and ATSC.
−Removed: AC-4 has also been adopted or proposed in forthcoming regional and country standards in North America, Europe, and Latin America.
−Removed: The transition for AC-4 continues to gain momentum, and is already being supported in a number of TVs that are available worldwide from major manufacturers.
−Removed: In mobile devices, HE-AAC is specified for various applications in the 3rd Generation Partnership Project suite of standards.
+Added: • AC-4 is Dolby’s audio coding technology that has been adopted for implementation for next generation broadcast services in certain regions by worldwide standards organizations including the DVB and ATSC.
+Added: In Europe, AC-4 has been mandated in next generation broadcast specifications for Denmark, Finland, Iceland, Ireland, Italy, Norway, Poland and Sweden, and is also included in the specification for the new UHD terrestrial TV platform issued by regulator ARCOM in France.
+Added: In North America, AC-4 is mandated for TVs for the NextGen TV over-the-air broadcast platform, based on ATSC3.0.
+Added: The adoption of AC-4
+Added: continues to grow, and AC-4 is already widely supported in UHDTVs available worldwide from major manufacturers.
+Added: • In mobile devices, HE-AAC v2 (3GPP eAAC +) is specified for various applications in the 3rd Generation Partnership Project suite of standards.
• Extended HE-AAC is included in Digital Radio Mondiale radio broadcasting standards.
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Our product quality is enabled through the use of well-established, and in some cases, highly automated, assembly processes along with rigorous testing of our products.
−Removed: Although we have some manufacturing facilities, we rely primarily upon contract manufacturers for the majority of our production capacity.
+Added: We rely primarily upon contract manufacturers for the majority of our production capacity.
We purchase components and fabricated parts from multiple suppliers;
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SALES AND MARKETING
−Removed: Our marketing efforts focus on demonstrating how our solutions improve entertainment and communications experiences.
+Added: Our marketing efforts focus on demonstrating how our solutions improve entertainment experiences.
We sell our solutions primarily using an internal sales organization to various customers in the markets where we operate.
+Added: We also license our technologies and IP indirectly through patent pools, where owners of IP covering technology standards aggregate their patents and offer the pooled patents to implementers through patent pool licensing administrators who are responsible for the sales and marketing of the pooled patents .
We promote our solutions and our brand through industry events such as trade-shows, film festivals, movie premieres, product launches, as well as through our website, public relations, direct marketing, co-marketing programs, and social media.
In addition, we hold the naming rights to the Dolby Theatre, home to the Academy Awards® in Hollywood, California, where we showcase our technology and host high-profile events.
+Added: We also hold the naming rights to Dolby Live at the Park MGM in Las Vegas, Nevada.
+Added: Dolby Live is a fully integrated performance venue offering live concerts in Dolby Atmos.
We maintain more than 20 sales offices in key regions around the globe.
We license our technologies to a broad set of customers that operate in a wide range of industries, and we sell our professional products either directly to the end user or, more commonly, through dealers and distributors.
−Removed: Users of our professional products and services include film studios, content creators, post-production facilities, cinema operators, broadcasters, and video game designers.
−Removed: The entertainment and communications industries are highly competitive, and we face aggressive competition in all areas of our business.
+Added: our professional products and services include film studios, content creators, post-production facilities, cinema operators, broadcasters, and video game designers.
+Added: The entertainment industry are highly competitive, and we face aggressive competition in all areas of our business.
Some of our current and future competitors may have significantly greater financial, technical, marketing, and other resources than we do, or may have more experience or advantages in the markets in which they compete.
In addition, some of our current or potential competitors may be able to offer integrated systems in certain markets for entertainment technologies, including audio and imaging, which could make competing technologies that we develop or acquire obsolete.
−Removed: By offering an integrated system solution, these potential
−Removed: competitors may also be able to offer competing technologies at lower prices than we can, which could adversely affect our operating results.
+Added: By offering an integrated system solution, these potential competitors may also be able to offer competing technologies at lower prices than we can, which could adversely affect our operating results.
Many products that include our audio and imaging technologies also include technologies developed by our competitors.
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At Dolby, we strive to act as a good partner to our customers, employees, shareholders, and communities.
−Removed: We are committed to fostering a workplace environment in which every employee can contribute their fullest potential, based on their individual experiences and perspectives, to our common efforts and make a positive impact through their roles.
+Added: We are committed to fostering a workplace environment in which every employee can contribute their fullest potential and make a positive impact through their roles.
Details of this work are available in our Sustainability Report, and we encourage you to read it on our website and learn more.
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Our workforce strategies prioritize employee well-being and take an integrated approach to mental, physical, and financial well-being for our employees.
−Removed: We have expanded our mental well-being programs to include therapy and access to wellness coaching, mindfulness training and live community sessions.
−Removed: As the communities we operate in adopt COVID-19 measures, we continue to implement business strategies that support the health and safety of our employees and enable business continuity.
−Removed: We have implemented a flex work program that enables employee connection and effective work delivery in a hybrid work environment.
+Added: We have expanded our well-being programs to include therapy and access to wellness coaching, mindfulness training and live community sessions.
+Added: We continue to implement business strategies that support the health and safety of our employees and enable business continuity.
+Added: We have implemented a flex work program that enables employee connection and effective work delivery globally.
In a company-wide survey in May 2023, Motivation & Commitment scores indicate that we remain highly connected to our work and each other.
Diversity, Inclusion and Belonging ("DIB")
−Removed: We are committed to being a part of creating a more equitable world.
−Removed: Different backgrounds, perspectives, and beliefs bring critical value to our business, and we’re driven by the knowledge that diverse talent enhances our ability to imagine, innovate, and grow.
−Removed: To invest in the talent of the future, we provide financial contributions, employee engagement, and in-kind support of science, technology, engineering, arts, and mathematics education and workforce initiatives at the K-12, university, and early-career levels and are engaged in strategic partnerships with universities to help develop the next generation of diverse talent at Dolby.
+Added: To spark positive change, bolster employee resiliency, and strengthen our community, DIB is embedded across company programs.
+Added: Our approach comprises investing in the next generation of talent, cultivating a culture of inclusion, and belonging and advancing and retaining our employees.
+Added: To invest in the talent of the future, we provide financial contributions, employee engagement, and support of science, technology, engineering, arts, and mathematics education and partnerships at K-12 schools and universities.
We have programs and practices in place to support creating an environment where individual experiences and perspectives are welcome and where everyone can belong and thrive.
−Removed: This includes equipping our leaders, colleagues, and peers with tools to have open and authentic conversations with the goal of becoming more aware and more empathetic to others’ experiences.
−Removed: We look at DIB comprehensively through hiring, retention, progression, and employee experiences.
−Removed: We empower everyone at Dolby to be co-creators of change by offering employees opportunities to learn and grow through educational sessions, hands-on workshops, employee-led Employee Network ("EN") events, and company-led DIB programs.
+Added: This includes equipping our leaders, colleagues, and peers with tools to have open and authentic conversations.
+Added: We look at diversity, inclusion and belonging comprehensively through hiring, retention, progression, and employee experiences.
+Added: We empower everyone at Dolby to be co-creators of change by offering employees opportunities to learn and grow through educational sessions, hands-on workshops, and employee-led Employee Network ("EN") events.
Our EN community encompasses 14 networks, convening around many different dimensions of diversity including gender, race/ethnicity and more, to build community and drive awareness of issues impacting employees identifying with these dimensions of diversity and their allies.
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From mentoring youth, to supporting adults re-entering the workforce, to aiding people experiencing hardships, our employees are making our communities stronger.
−Removed: We also partner with educational organizations in our local communities around the world, including Bay Area Video Coalition, Girls Who Code, Greene Scholars, IGNITE Worldwide, Inneract Project, Resource Area For Teaching, University of Sydney’s Women in Engineering Program, and Fundacja Rodziny Maciejko in Poland to organize volunteer opportunities.
−Removed: Our educational efforts are intended to share Dolby’s experiences, ideas and approaches from our unique position at the intersection of science, technology and art.
+Added: We partner with organizations in our local communities around the world, including the Arts, Media and Entertainment Institute, Bay Area Video Coalition, Girls Make Beats, Girls Who Code, IGNITE Worldwide, Inneract Project, University of Sydney’s Women in Engineering Program, and Fundacja Rodziny Maciejko in Poland to organize employee volunteer opportunities.
+Added: Our efforts are intended to share Dolby’s experiences, ideas and approaches from our unique position at the intersection of science, technology and art.
Management Succession Planning
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.