JetBlue Airlines 2010 Annual Report Download - page 76

Note 8—LiveTV
Purchased technology, which is an intangible asset related to our September 2002 acquisition of the
membership interests of LiveTV, was being amortized over seven years based on the average number of
aircraft expected to be in service as of the date of acquisition. Purchased technology became fully amortized
in 2009.
Through December 31, 2010, LiveTV had installed in-flight entertainment systems for other airlines on
518 aircraft and had firm commitments for installations on 143 additional aircraft scheduled to be installed
through 2014, with options for 91 additional installations through 2014. Revenues in 2010, 2009 and 2008
were $72 million, $65 million and $58 million, respectively. Deferred profit on hardware sales and advance
deposits for future hardware sales are included in long term liabilities in our consolidated balance sheets and
was $35 million and $29 million at December 31, 2010 and 2009, respectively. Deferred profit to be
recognized on installations completed through December 31, 2010 will be approximately $3 million per year
from 2011 through 2013, $2 million per year in 2014 and 2015 and $9 million thereafter. The net book value
of equipment installed for other airlines was approximately $114 million and $64 million as of December 31,
2010 and 2009, respectively.
Note 9—Income Taxes
The provision (benefit) for income taxes consisted of the following for the years ended December 31 (in
millions):
2010 2009 2008
Deferred:
Federal............................................................ $55 $35 $(6)
State ............................................................. 7 7 —
Deferred income tax expense (benefit) ...................................... $62 $42 $(6)
Current income tax expense .............................................. 2 1 1
Total income tax expense (benefit) . ........................................ $64 $43 $(5)
The effective tax rate on income (loss) before income taxes differed from the federal income tax statutory
rate for the years ended December 31 for the following reasons (in millions):
2010 2009 2008
Income tax expense (benefit) at statutory rate . . ............................... $57 $36 $(31)
Increase (decrease) resulting from:
State income tax, net of federal benefit.................................... 6 4 (4)
Non-deductible meals ................................................ 2 2 1
Non-deductible costs ................................................. — — 4
Valuation allowance .................................................. (2) (1) 23
Other, net ......................................................... 1 2 2
Total income tax expense (benefit) ......................................... $64 $43 $ (5)
There were cash payments for income taxes of $1 million in 2010 and none in 2009 or 2008.
The net deferred taxes below include a current net deferred tax asset of $89 million and a long-term net
deferred tax liability of $327 million at December 31, 2010, and a current net deferred tax asset of
$74 million and a long-term net deferred tax liability of $259 million at December 31, 2009.
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