Amazon.com 2015 Annual Report Download - page 65

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55
Goodwill
The goodwill of the acquired companies is generally not deductible for tax purposes and is primarily related to expected
improvements in technology performance and functionality, as well as sales growth from future product and service offerings
and new customers, together with certain intangible assets that do not qualify for separate recognition. The following
summarizes our goodwill activity in 2015 and 2014 by segment (in millions):
North
America International AW S Consolidated
Goodwill - January 1, 2014 $ 2,033 $ 622 $
$ 2,655
New acquisitions (1) 553 162
715
Other adjustments (2) (2) (49)
(51)
Goodwill - December 31, 2014 2,584 735
3,319
Segment reallocation—January 1, 2015 (3) (606)
606
New acquisitions 41 18 423 482
Other adjustments (2) (7) (34) (1) (42)
Goodwill - December 31, 2015 $ 2,012 $ 719 $ 1,028 $ 3,759
___________________
(1) Primarily includes the goodwill of Twitch.
(2) Primarily includes changes in foreign exchange rates.
(3) In conjunction with the change in reportable segments, we reallocated goodwill on a relative fair value basis.
Intangible Assets
Acquired intangible assets, included within “Other assets” on our consolidated balance sheets, consist of the following (in
millions):
December 31,
2015 2014
Weighted
Average Life
Remaining
Acquired
Intangibles,
Gross (1)
Accumulated
Amortization
(1)
Acquired
Intangibles,
Net
Acquired
Intangibles,
Gross (1)
Accumulated
Amortization
(1)
Acquired
Intangibles,
Net
Marketing-related 4.4 $ 457 $ (250) $ 207 $ 457 $ (199) $ 258
Contract-based 2.1 130 (99) 31 172 (125) 47
Technology- and
content-based 3.9 559 (205) 354 370
(129) 241
Customer-related 3.6 331 (161) 170 535 (317) 218
Acquired
intangibles (2) 3.9 $ 1,477 $ (715) $ 762 $ 1,534
$ (770) $ 764
___________________
(1) Excludes the original cost and accumulated amortization of fully-amortized intangibles.
(2) Intangible assets have estimated useful lives of between one and ten years.
Amortization expense for acquired intangibles was $228 million, $181 million, and $168 million in 2015, 2014, and
2013. Expected future amortization expense of acquired intangible assets as of December 31, 2015 is as follows (in millions):
Year Ended December 31,
2016 $ 218
2017 191
2018 131
2019 103
2020 41
Thereafter 78
$ 762