Verizon Wireless 2010 Annual Report Download - page 56

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Notes to Consolidated Financial Statements continued
54
NOTE 4
WIRELESS LICENSES, GOODWILL AND OTHER INTANGIBLE ASSETS
Wireless Licenses
Changes in the carrying amount of wireless licenses are as follows:
(dollars in millions)
Balance at December 31, 2008 $ 61,974
Wireless licenses acquired (Note 2) 9,444
Capitalized interest on wireless licenses 730
Reclassifications, adjustments and other (81)
Balance at December 31, 2009 $ 72,067
Wireless licenses acquired (Note 2) 178
Capitalized interest on wireless licenses 748
Reclassifications, adjustments and other 3
Balance at December 31, 2010 $ 72,996
During the years ended December 31, 2010 and 2009, approximately $12.2 billion of wireless licenses were under development for commercial service
for which we were capitalizing interest costs. In December 2010, a portion of these licenses were placed in service. Accordingly, approximately $3.3
billion of wireless licenses continue to be under development for commercial service.
During 2008, Verizon Wireless was the winning bidder in the FCC auction of spectrum in the 700 MHz band and paid the FCC $9.4 billion to acquire
109 licenses in the 700 MHz band.
The average remaining renewal period of our wireless license portfolio was 6.9 years as of December 31, 2010 (see Note 1, Goodwill and Other
Intangible Assets – Intangible Assets Not Subject to Amortization).
Goodwill
Changes in the carrying amount of goodwill are as follows:
(dollars in millions)
Domestic
Wireless Wireline Total
Balance at December 31, 2008 $ 1,297 $ 4,738 $ 6,035
Acquisitions (Note 2) 16,353 – 16,353
Reclassifications, adjustments and other 88 (4) 84
Balance at December 31, 2009 $ 17,738 $ 4,734 $ 22,472
Acquisitions (Note 2) 131 – 131
Dispositions (Note 3) – (614) (614)
Reclassifications, adjustments and other – (1) (1)
Balance at December 31, 2010 $ 17,869 $ 4,119 $ 21,988
Reclassifications, adjustments and other in Domestic Wireless during 2009 relate to the finalization of the Rural Cellular purchase accounting.
Other Intangible Assets
The following table displays the composition of other intangible assets:
(dollars in millions)
At December 31, 2010 At December 31, 2009
Gross
Amount
Accumulated
Amortization
Net
Amount
Gross
Amount
Accumulated
Amortization
Net
Amount
Other intangible assets:
Customer lists (6 to 8 years) $ 3,150 $ (1,551) $ 1,599 $ 3,134 $ (1,012) $ 2,122
Non-network internal-use software (2 to 7 years) 8,446 (4,614) 3,832 8,455 (4,346) 4,109
Other (2 to 25 years) 885 (486) 399 865 (332) 533
Total $ 12,481 $ (6,651) $ 5,830 $ 12,454 $ (5,690) $ 6,764
The amortization expense for other intangible assets was as follows:
Years (dollars in millions)
2010 $ 1,812
2009 1,970
2008 1,383
Estimated annual amortization expense for other intangible assets is as
follows:
Years (dollars in millions)
2011 $ 1,656
2012 1,335
2013 1,100
2014 729
2015 512