Goodwill and Other Intangible Assets

3 Months Ended

Mar. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

The following table summarizes the changes in the Company’s goodwill balances from December 31, 2016 to March 31, 2017 for the Company’s two reporting units:



	Web Presence Unit		Email Marketing Unit		Total
	Amount		Amount		Amount
	(in thousands)		(in thousands)		(in thousands)
Goodwill balance at December 31, 2016	$	1,255,604	$	604,305	$	1,859,909
Goodwill related to 2016 acquisitions	—		—		—
Foreign translation impact	382		—		382
Goodwill balance at March 31, 2017	$	1,255,986	$	604,305	$	1,860,291

In accordance with ASC 350, the Company reviews goodwill and other indefinite-lived intangible assets for indicators of impairment on an annual basis and between tests if an event occurs or circumstances change that would more likely than not reduce the fair value of goodwill below its carrying amount.

At December 31, 2016, other intangible assets consisted of the following:



	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Useful Life
	(dollars in thousands)
Developed technology	$	284,005	$	111,348	$	172,657	7 years
Subscriber relationships	659,662		345,070		314,592		7 years
Trade-names	133,805		57,789		76,016		8 years
Intellectual property	34,084		10,270		23,814		13 years
Domain names available for sale	29,954		4,976		24,978		Indefinite
Leasehold interests	314		314		—		1 year
Total December 31, 2016	$	1,141,824	$	529,767	$	612,057

During the three months ended March 31, 2016, the Company wrote-off acquired in-process research and development of $1.4 million related to its acquisition of Webzai in 2014, as the Company had abandoned certain research and development projects in favor of other projects. There were no impairment charges of intangible assets during the three months ended March 31, 2017.

At March 31, 2017, other intangible assets consisted of the following:



	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Useful Life
	(dollars in thousands)
Developed technology	$	284,043	$	119,810	$	164,233	7 years
Subscriber relationships	659,762		366,163		293,599		7 years
Trade-names	133,806		61,280		72,526		8 years
Intellectual property	34,120		11,145		22,975		13 years
Domain names available for sale	30,121		5,431		24,690		Indefinite
Leasehold interests	314		314		—		1 year
Total March 31, 2017	$	1,142,166	$	564,143	$	578,023

The estimated useful lives of the individual categories of other intangible assets are based on the nature of the applicable intangible asset and the expected future cash flows to be derived from the intangible asset. Amortization of intangible assets with finite lives is recognized over the period of time the assets are expected to contribute to future cash flows. The Company amortizes finite-lived intangible assets over the period in which the economic benefits are expected to be realized based upon their estimated projected cash flows.

The Company’s amortization expense is included in cost of revenue in the aggregate amounts of $29.9 million and $34.3 million for the three months ended March 31, 2016 and 2017, respectively.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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