Liberty Broadband Corporation Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Intangible Assets and Goodwill

Intangible Assets and Goodwill

12 Months Ended

Dec. 31, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

As of October 31, 2013, cable certificates, wireless licenses and goodwill were tested for impairment and the fair values were greater than the carrying amounts, therefore these intangible assets were determined not to be impaired at December 31, 2013. The remaining useful lives of our cable certificates, wireless licenses, and goodwill were evaluated as of October 31, 2013, and events and circumstances continue to support an indefinite useful life. There are no indicators of impairment of our intangible assets subject to amortization as of December 31, 2013.

During the year ended December 31, 2013, we acquired $2.8 million in broadcast licenses from our acquisitions pursuant to the Media Agreements.

Other Intangible Assets subject to amortization include the following at December 31, 2013 and 2012 (amounts in thousands):



	2013		2012
Rights to use	$	55,407	—
Software license fees	41,804		35,416
Customer relationships	3,036		3,036
Right-of-way	783		783
	101,030		39,235
Less accumulated amortization	29,595		22,675
Net other intangible assets	$	71,435	16,560

Under the terms of the Wireless Agreement, we acquired from ACS rights to use capacity on its network and the associated maintenance on this network capacity for 20 years.

Changes in Goodwill and Other Intangible Assets are as follows (amounts in thousands):



	Goodwill		Other Intangible Assets
Balance at December 31, 2011	$	74,883	15,835
Contingent consideration to former shareholders of United Utilities, Inc.	2,411		—
Asset additions	—		5,952
Less amortization expense	—		5,227
Balance at December 31, 2012	77,294		16,560
Goodwill addition from AWN acquisition	140,080		—
Goodwill addition from Denali Media acquisitions	1,667		—
Asset additions	—		61,919
Less amortization expense	—		7,044
Balance at December 31, 2013	$	219,041	71,435

Amortization expense for amortizable intangible assets for the years ended December 31, 2013, 2012 and 2011 follow (amounts in thousands):



	Years Ended December 31,
	2013		2012	2011
Amortization expense	$	7,044	5,227	6,039

Amortized intangible assets are definite-life assets, and as such, we record amortization expense based on a method that most appropriately reflects our expected cash flows from these assets. Intangible assets that have finite useful lives are amortized over their useful lives using the straight-line method, a weighted-average of 15.8 years.

Amortization expense for amortizable intangible assets for each of the five succeeding fiscal years is estimated to be (amounts in thousands):



Years Ending December 31,
2014	$	8,196
2015	6,670
2016	5,006
2017	3,880
2018	3,054

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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