DIRECTV 2007 Annual Report Download - page 86

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THE DIRECTV GROUP, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(continued)
The following table sets forth the amount of DIRECTV U.S. set-top receivers we capitalized, and
depreciation expense we recorded, under the lease program for each of the periods presented:
Years Ended
December 31,
Capitalized subscriber leased equipment: 2007 2006
(Dollars in
Millions)
Subscriber leased equipment—subscriber acquisitions ................. $ 762 $ 599
Subscriber leased equipment—upgrade and retention ................. 774 473
Total subscriber leased equipment capitalized ....................... $1,536 $1,072
Depreciation expense—subscriber leased equipment .................. $ 645 $ 147
Note 5: Goodwill and Intangible Assets
The changes in the carrying amounts of goodwill by segment for the years ended December 31,
2007 and 2006 were as follows:
DIRECTV
DIRECTV U.S. Latin America Total
(Dollars in Millions)
Balance as of January 1, 2006 .......................... $3,032 $ 13 $3,045
Sky Transactions .................................... — 470 470
Balance as of December 31, 2006 ........................ 3,032 483 3,515
Acquisition of Darlene interest in DLA LLC ............... — 187 187
Finalization of Sky Brazil purchase price allocation ........... — (31) (31)
Other ............................................ — (2) (2)
Balance as of December 31, 2007 ........................ $3,032 $637 $3,669
We performed our annual impairment tests for goodwill and orbital slots in the fourth quarters of
2007, 2006, and 2005. The estimated fair values for each reporting unit and the orbital slots exceeded
our carrying values, and accordingly, no impairment losses were recorded during 2007, 2006, or 2005.
The following table sets forth the amounts recorded for intangible assets at December 31:
December 31, 2007 December 31, 2006
Estimated
Useful Lives Gross Accumulated Net Gross Accumulated Net
(years) Amount Amortization Amount Amount Amortization Amount
(Dollars in Millions)
Orbital slots ................... Indefinite $ 432 $ 432 $ 432 $ 432
72.5WL Orbital license .......... 5 208 $ 132 76 182 $ 94 88
Subscriber related ............... 5-10 1,697 942 755 1,597 620 977
Dealer network ................. 15 130 71 59 130 62 68
Trade name and other ............ 10-20 95 5 90 36 2 34
Distribution rights ............... 7 334 169 165 334 122 212
Total intangible assets ............ $2,896 $1,319 $1,577 $2,711 $900 $1,811
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