XM Radio 2012 Annual Report Download - page 104

SIRIUS XM RADIO INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
We hold FCC licenses to operate our satellite digital audio radio service and provide ancillary services. The
following table outlines the years in which each of our licenses expires:
FCC satellite licenses Expiration year
SIRIUS FM-1 .......................................................... 2017
SIRIUS FM-2 .......................................................... 2017
SIRIUS FM-3 .......................................................... 2017
SIRIUS FM-5 .......................................................... 2017
SIRIUS FM-6 (1)
XM-1 ................................................................ 2014
XM-2 ................................................................ 2014
XM-3 ................................................................ 2013
XM-4 ................................................................ 2014
XM-5 ................................................................ 2018
(1) We hold an FCC license for our FM-6 satellite, which will expire eight years from when this satellite is launched and
placed into operation.
Prior to expiration, we are required to apply for a renewal of our FCC licenses. The renewal and extension
of our licenses is reasonably certain at minimal cost, which is expensed as incurred. Each of the FCC licenses
authorizes us to use the broadcast spectrum, which is a renewable, reusable resource that does not deplete or
exhaust over time.
In connection with the Merger, $250,000 of the purchase price was allocated to the XM trademark. As of
December 31, 2012, there were no legal, regulatory or contractual limitations associated with the XM trademark.
Our annual impairment assessment of our indefinite intangible assets is performed as of the fourth quarter of
each year. An assessment is performed at other times if an event occurs or circumstances change that would more
likely than not reduce the fair value of the asset below its carrying value. At the date of our annual assessment for
2012, our qualitative impairment assessment of fair value of our indefinite intangible assets indicated that such
assets substantially exceeded their carrying value and therefore was not at risk of impairment. In 2011, we
utilized independent appraisals to assist in determining the fair value of our indefinite intangible assets.
As of December 31, 2012, there were no indicators of impairment and no impairment loss was recorded for
indefinite intangible assets during the years ended December 31, 2012, 2011 and 2010.
Definite Life Intangible Assets
Subscriber relationships are amortized on an accelerated basis over 9 years, which reflects the estimated
pattern in which the economic benefits will be consumed. Other definite life intangible assets include certain
licensing agreements, which are amortized over a weighted average useful life of 9.1 years on a straight-line
basis.
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