NetFlix 2011 Annual Report Download - page 61

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Content Liabilities
Content liabilities consisted of the following:
As of December 31,
2011 2010
Streaming DVD and other Total Streaming DVD and other Total
(in thousands)
Content accounts payable .......... $ 905,792 $18,914 $ 924,706 $136,841 $31,854 $168,695
Non-current content liabilities ....... 739,628 — 739,628 48,179 — 48,179
Total content liabilities ............ $1,645,420 $18,914 $1,664,334 $185,020 $31,854 $216,874
The Company typically enters into multi-year licenses with studios and other distributors that may result in
an increase in content library and a corresponding increase in content accounts payable and non-current content
liabilities. The payment terms for these license fees may extend over the term of the license agreement, which
could range from six months to five years. As of December 31, 2011, content accounts payable and non-current
content liabilities increased $1.45 billion, over December 31, 2010, as compared to an increase in total content
library, net, of $1.60 billion.
Property and Equipment, Net
Property and equipment and accumulated depreciation consisted of the following:
As of December 31,
2011 2010
(in thousands)
Computer equipment ................... 3years $ 67,090 $ 60,289
Operations and other equipment .......... 5years 100,306 72,368
Software, including internal-use software . . 3 years 35,356 26,961
Furniture and fixtures .................. 3years 17,310 11,438
Building ............................ 30years 40,681 40,681
Leasehold improvements ............... Over life of lease 44,473 36,530
Capital work-in-progress ................................ 822 16,882
Property and equipment, gross ............................ 306,038 265,149
Less: Accumulated depreciation ........................... (169,685) (136,579)
Property and equipment, net .............................. $136,353 $ 128,570
Accrued Expenses
Accrued expenses consisted of the following:
As of December 31,
2011 2010
(in thousands)
Accrued state sales and use tax ............................... $14,557 $14,983
Accrued payroll and employee benefits ........................ 17,763 8,520
Accrued interest on debt .................................... 2,125 2,125
Accrued content related costs ................................ 10,774 6,950
Accrued legal settlement .................................... 9,000 —
Current portion of lease financing obligations ................... 2,319 2,083
Other ................................................... 7,155 3,911
Accrued expenses ......................................... $63,693 $38,572
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