TiVo 2011 Annual Report Download - page 82

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Table of Contents
table below:
Fiscal Year Ending January 31, Estimated Annual
Amortization
Expense
(In thousands)
2013 $ 2,264
2014 1,580
2015 419
2016 330
2017 84
Total $ 4,677
8. ACCRUED LIABILITIES
Accrued liabilities consist of the following:
As of January 31,
2012 2011
(In thousands)
Compensation and vacation $ 18,625 $ 12,873
Marketing and promotions 3,904 4,507
Legal services 11,516 3,761
Redeemable gift certificates for subscriptions 2,499 2,646
Interest payable 2,588 —
Other 6,209 6,328
Total accrued liabilities $ 45,341 $ 30,115
9. COMMITMENTS AND CONTINGENCIES
Product Warranties
The Company’s standard manufacturer's warranty period to consumers for TiVo-enabled DVRs is 90 days for parts and labor from the date of consumer
purchase, and from 91-365 days for parts only, also known as the Limited Warranty. Within the limited warranty period, consumers are offered a no-charge
exchange for TiVo-enabled DVRs returned due to product defect, within 90 days from the date of consumer purchase. Thereafter, consumers may exchange a
TiVo-enabled DVR with a product defect for a charge. As of January 31, 2012 and January 31, 2011, the accrued warranty reserve was $194,000 and
$419,000, respectively. The Company’s accrued warranty reserve is included in accrued liabilities in the accompanying consolidated balance sheets.
The Company also offers customers separately priced optional 2-year and 3-year extended warranties. The Company defers and amortizes cost and
revenue associated with the sales of the extended warranties over the warranty period or until a warranty is redeemed. As of January 31, 2012, the extended
warranty deferred revenue and cost was $913,000 and $280,000, respectively. As of January 31, 2011, the extended warranty deferred revenue and cost was
$891,000 and $269,000, respectively.
Purchase Commitments with Contract Manufacturers and Suppliers
The Company purchases components from a variety of suppliers and use several contract manufacturers to provide manufacturing services for its
products. During the normal course of business, in order to manage manufacturing lead times and help ensure adequate component supply, the Company
enters into agreements with the Company's contract manufacturer and suppliers that either allow them to procure inventory based upon criteria
79