AT&T Wireless 2009 Annual Report Download - page 74

Notes to Consolidated Financial Statements (continued)
Dollars in millions except per share amounts
72 AT&T 09 AR
Certain facilities and equipment used in operations are
leased under operating or capital leases. Rental expenses
under operating leases were $2,889 for 2009, $2,733 for
2008 and $2,566 for 2007. At December31,2009, the future
minimum rental payments under non-cancelable operating
leases for the years 2010 through 2014 were $2,429, $2,276,
$2,057, $1,859 and $1,707, with $10,230 due thereafter.
Certain real estate operating leases contain renewal options
that may be exercised. Capital leases are not significant.
American Tower Corp. Agreement
In August 2000, we reached an agreement with American
Tower Corp. (American Tower) under which we granted
American Tower the exclusive rights to lease space on a
number of our communications towers. In exchange, we
received a combination of cash and equity instruments as
complete prepayment of rent with the closing of each leasing
agreement. The value of the prepayments was recorded as
deferred revenue and recognized in income as revenue over
the life of the leases. The balance of deferred revenue was
$509 in 2009, $539 in 2008 and $569 in 2007.
NOTE 5. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment is summarized as follows at
December 31:
Lives (years) 2009 2008
Land — $ 1,724 $ 1,730
Buildings 35-45 24,271 23,372
Central office equipment 3-10 78,314 75,054
Cable, wiring and conduit 10-50 74,325 72,109
Other equipment 5-15 39,918 34,434
Software 3-5 8,841 8,348
Under construction — 3,159 3,532
230,552 218,579
Accumulated depreciation
and amortization 130,459 119,491
Property, plant and
equipment – net $100,093 $ 99,088
Our depreciation expense was $15,959 in 2009, $15,313 in
2008 and $15,625 in 2007.
NOTE 6. GOODWILL AND OTHER INTANGIBLE ASSETS
Changes in the carrying amounts of goodwill, by segment, for the years ended December 31, 2009 and 2008, are as follows:
Advertising
Wireless Wireline Solutions Other Total
Balance as of January 1, 2008 $ 32,713 $ 31,301 $ 5,788 $ 911 $ 70,713
Goodwill acquired 264 185 — — 449
Goodwill adjustments for prior-year acquisitions
and tax adjustments 990 (95) (26) — 869
Other (116) (10) (68) (8) (202)
Balance as of December 31, 2008 33,851 31,381 5,694 903 71,829
Goodwill acquired 1,276 344 36 — 1,656
Other (90) (117) 1 (20) (226)
Balance as of December 31, 2009 $35,037 $31,608 $5,731 $883 $73,259
or wireless FCC licenses in 2009 and 2008. Goodwill in the
Other segment as of January 1, 2008, is net of a $1,791
impairment that was recognized in a prior period. We review
other long-lived assets for impairment whenever events or
circumstances indicate that the carrying amount may not
be recoverable over the remaining life of the asset or
asset group.
Goodwill acquired relates primarily to the acquisition of
Centennial and a provider of mobile application solutions
(see Note 2). Changes to goodwill include adjustments
totaling $90 related to wireless liabilities in connection with
a business combination and disposition of a wireline entity
for $117 in 2009.
Goodwill and wireless FCC licenses are not amortized but
tested annually as of October 1 for impairment as required
by GAAP. The carrying amounts of goodwill, by segment
(which is the same as reporting unit for Wireless, Wireline and
Advertising Solutions), at December 31, 2009 were Wireless
$35,037; Wireline $31,608; Advertising Solutions $5,731;
and Other $883 and at December 31, 2008 were Wireless
$33,851; Wireline $31,381; Advertising Solutions $5,694; and
Other $903. Within the Other segment, goodwill associated
with our Sterling operations was $477 for 2009 and 2008.
Additionally, FCC licenses are tested for impairment on an
aggregate basis, consistent with the management of the
business on a national scope. These annual impairment
tests resulted in no impairment of indefinite-lived goodwill