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Revenue Recognition
3 Months Ended
Mar. 31, 2020
Revenue Recognition [Abstract]  
Revenue Recognition

3. Revenue Recognition

The Company derives its revenue primarily from software development services and software subscriptions.  Applicable revenue recognition criteria are considered separately for each performance obligation as follows:

 

Service revenue consists primarily of revenue earned from the performance of software development services. The majority of service contracts are structured as time and materials agreements.  Revenue for services is recognized as the services are performed. Billing for services rendered generally occurs within one month after the services are provided.

 

Subscription revenue consists primarily of revenue earned from the sale of software products and to a lesser extent the licensing of intellectual property. The majority of subscription contracts are recurring, paid in advance and recognized over the term of the subscription, which is typically one to three years.

Customer arrangements may contain multiple performance obligations such as software development services, software licenses, and maintenance and support fees. The Company accounts for individual products and services separately if they are distinct. To determine the transaction price, the Company considers the terms of the contract and the Company’s customary business practices. Some contracts may contain variable consideration. In those cases, the Company estimates the amount of variable consideration based on the sum of probability-weighted amounts in a range of possible consideration amounts. As part of this assessment, the Company will evaluate whether any of the variable consideration is constrained and if it is the Company will not include it in the transaction price. The consideration is allocated between distinct products and services based on their stand-alone selling prices. For items that are not sold separately, the Company estimates the standalone selling price based on reasonably available information, including market conditions, specific factors affecting the Company, and information about the customer. For distinct products and services, the Company typically recognizes the revenue associated with these performance obligations as they are delivered to the customer.  Products and services that are not capable of being distinct are combined with other products or services until a distinct performance obligation is identified. The revenue associated with this performance obligation is typically recognized over the term of the contract as the customer simultaneously receives and consumes the products and services.

All revenue recognized in the Consolidated Statements of Operations is considered to be revenue from contracts with customers.

The following table provides information about disaggregated revenue by major market category in the Company’s single reporting segment:

 

 

Three

 

 

Three

 

 

 

Months

 

 

Months

 

 

 

Ended

 

 

Ended

 

 

 

March 31,

 

 

March 31,

 

 

 

2020

 

 

2019

 

Government

 

 

 

 

 

 

 

 

Service

 

$

3,652

 

 

$

3,634

 

Subscription

 

 

391

 

 

 

428

 

Total Government

 

$

4,043

 

 

$

4,062

 

Retail

 

 

 

 

 

 

 

 

Service

 

$

86

 

 

$

180

 

Subscription

 

 

1,175

 

 

 

564

 

Total Retail

 

$

1,261

 

 

$

744

 

Media

 

 

 

 

 

 

 

 

Service

 

$

 

 

$

 

Subscription

 

 

885

 

 

 

854

 

Total Media

 

$

885

 

 

$

854

 

 

 

 

 

 

 

 

 

 

Total

 

$

6,189

 

 

$

5,660

 

 

The Company has contract assets from contracts with customers that are classified as “trade accounts receivable.”  Financial information about trade accounts receivable is included in Note 8.  

The Company has contract liabilities from contracts with customers that are classified as “deferred revenue.”  Deferred revenue consists of billings in advance for services and subscriptions for which the performance obligation has not been satisfied.

The following table provides information about contract liabilities from contracts with customers:

 

 

March 31,

 

 

December 31,

 

 

 

2020

 

 

2019

 

Deferred revenue, current

 

$

3,015

 

 

$

3,172

 

Deferred revenue, long-term

 

 

70

 

 

 

59

 

Total

 

$

3,085

 

 

$

3,231

 

The Company recognized $1,374 of revenue during the three months ended March 31, 2020 that was included in the contract liability balance as of December 31, 2019.

The aggregate amount of transaction prices from contractual obligations that are unsatisfied or partially unsatisfied was $17,454 and $17,759 as of March 31, 2020 and December 31, 2019, respectively.