Juno 2014 Annual Report Download - page 43

Table of Contents
Sales and Marketing
Sales and marketing expenses include expenses associated with promoting our brands, services and products and with generating advertising revenues.
Expenses associated with promoting our brands, services and products include advertising and promotion expenses; fees paid to distribution partners, third-
party advertising networks and co-registration partners to acquire new pay and free accounts; personnel and overhead-related expenses for marketing,
merchandising, customer service, and sales personnel; and telemarketing costs incurred to acquire and retain pay accounts and up-sell pay accounts to
additional services. Expenses associated with generating advertising revenues include sales commissions and personnel-related expenses. We have expended
significant amounts on sales and marketing, including branding and customer acquisition campaigns consisting of television, Internet, public relations,
sponsorships, print, and outdoor advertising, and on retail and other performance-based distribution relationships. Marketing and advertising costs to
promote our services and products are expensed in the period incurred. Advertising and promotion expenses include media, agency and promotion expenses.
Media production costs are expensed the first time the advertisement is run. Media and agency costs are expensed over the period the advertising runs.
Technology and Development
Technology and development expenses include expenses for product development, maintenance of existing software, technology and websites, and
development of new or improved software and technology, including personnel-related expenses for our technology group in various locations. Costs
incurred by us to manage and monitor our technology and development activities are expensed as incurred.
General and Administrative
General and administrative expenses, which include unallocated corporate expenses, consist of personnel-related expenses for executive, finance, legal,
human resources, facilities, internal audit, investor relations, internal customer support personnel and personnel associated with operating our corporate
network systems. In addition, general and administrative expenses include, among other costs, professional fees for legal, accounting and financial services;
insurance; occupancy and other overhead-related costs; office relocation costs; non-income taxes; gains and losses on the sale of assets; bad debt expense;
and reserves or expenses incurred as a result of settlements, judgments, fines, penalties, assessment, or other resolutions related to litigation, arbitration,
investigations, disputes, or similar matters. General and administrative expenses also include expenses resulting from actual or potential transactions such as
business combinations, mergers, acquisitions, dispositions, spin offs, financing transactions, and other strategic transactions, including, without limitation,
expenses for advisors and representatives such as investment bankers, consultants, attorneys, and accounting firms.
Amortization of Intangible Assets
Amortization of intangible assets includes amortization of acquired pay accounts and free accounts; certain acquired trademarks and trade names;
acquired software and technology; acquired customer and advertising contracts and related relationships; acquired rights, content and intellectual property;
and other acquired identifiable intangible assets.
Contingent Consideration—Fair Value Adjustment
Contingent consideration—fair value adjustment includes changes in the estimated fair value of contingent consideration, as well as interest expense
related to such contingent consideration. Changes to one or multiple inputs to the Monte-Carlo simulation used to estimate fair value, including the discount
rate, mean growth rates, volatility rates, the estimated number of daily registrations, and the
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