TiVo 2006 Annual Report Download - page 85

Table of Contents
4. PROPERTY AND EQUIPMENT, NET
Property and equipment, net consists of the following:
January 31, 2007 January 31, 2006
(In thousands)
Furniture and fixtures $ 3,414 $ 3,285
Computer and office equipment 17,465 20,946
Lab equipment 2,100 2,392
Leasehold improvements 7,900 6,319
Capitalized internal use software 11,345 9,926
Total property and equipment 42,224 42,868
Less: accumulated depreciation and amortization (30,518) (33,420)
Property and equipment, net $ 11,706 $ 9,448
5. PURCHASED TECHNOLOGY, CAPITALIZED SOFTWARE, AND INTANGIBLE ASSETS, NET
Purchased technology, capitalized software, and intangible assets, net consists of the following:
January 31, 2007 January 31, 2006
Gross
Accumulated
Amortization Net Gross
Accumulated
Amortization Net
(In thousands)
Purchased technology $ 1,500 $ (333) $ 1,167 $ — $ — $ —
Capitalized software 1,951 (807) $ 1,144 1,951 (404) $ 1,547
Intellectual property rights 16,265 (1,807) $ 14,458 4,265 (606) $ 3,659
Purchased technology, capitalized software, and intangible assets $ 19,716 $ (2,947) $ 16,769 $ 6,216 $ (1,010) $ 5,206
In September 2006, the Company entered into a cross-licensing agreement with IBM under which each party granted to the other a non-exclusive,
worldwide, royalty-free license to such party's patents that are entitled to a priority date on or before September 28, 2006, including all patents and patent
applications in existence as of that date with limited exceptions. The license granted by IBM to the Company extends to all products other than general
purpose data processing products and data storage devices that are primarily sold separately from other hardware. The license that the Company granted to
IBM extends to all products other than digital media recorders and digital media recorder software. No license was granted, directly or by implication, to
permit the combination of any product with any other item. This license is being amortized over the period of its estimated benefit period of 7 years.
The total expected future annual amortization expense related to purchased technology, capitalized software, and intangible assets is calculated on a
straight-line basis, using the useful lives of the assets, which range from three to five years for purchased technology and capitalized software and five to
seven years for intellectual property rights. Amortization expense for the fiscal years ended January 31, 2007, 2006 and 2005 was $1.9 million, $940,000, and
$70,000, respectively. Estimated future annual amortization expense is set forth in the table below:
Fiscal Year Ending
Estimated Annual
Amortization
Expense
(In thousands)
January 31, 2008 3,247
January 31, 2009 3,214
January 31, 2010 2,810
January 31, 2011 2,274
January 31, 2012 2,274
There after 2,950
Total $ 16,769
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