Enom 2010 Annual Report Download - page 140

Table of Contents
Demand Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (Continued)
(In thousands, except per share amounts)
17. Concentrations (Continued)
agreements, or if they are renewed, they may not be on terms as favorable as current agreements. The Company may not be successful in renewing its
agreements with advertising network partners on commercially acceptable terms. The percentage of revenue generated through advertising network partners
representing more than 10% of consolidated revenue is as follows:
Year ended
December 31,
2008 2009 2010
Advertising Network Partner A 14% 14% *
Advertising Network Partner B 12% 18% 29%
At December 31, 2009 and 2010, advertising network partners comprising more than 10% of the consolidated accounts receivable balance were as
follows:
2009 2010
Advertising Network Partner A 32% *
Advertising Network Partner B 22% 33%
less than 10% as of or for the period*
18. Business Combinations
The Company accounts for acquisitions of businesses using the purchase method of accounting where the cost is allocated to the underlying net tangible
and intangible assets acquired, based on their respective estimated fair values. The excess of the purchase price over the estimated fair values of the net assets
acquired is recorded as goodwill.
Determining the fair value of certain acquired assets and liabilities is subjective in nature and often involves the use of significant estimates and
assumptions, including, but not limited to, the selection of appropriate valuation methodology, projected revenue, expenses and cash flows, weighted average
cost of capital, discount rates, estimates of advertiser and publisher turnover rates and estimates of terminal values.
During the year ended December 31, 2008, the Company acquired businesses consistent with the Company's strategic plan of acquiring, consolidating
and developing Internet media properties and applications. In addition to identifiable assets acquired in these business combinations, the Company acquired
goodwill that primarily derives from the ability to generate synergies across the Company's media services and the loyalty of their user community.
The acquisitions are included in the Company's consolidated financial statements as of the date of the acquisition. The following tables summarize the
total purchase consideration and the estimated fair
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