NOTE 7. PROPERTY, PLANT AND EQUIPMENT


	Useful Lives		As of June 30,
	Useful Lives		2018			2017
			(in millions)
Land			$	150		$	153
Buildings and leaseholds		3 to 50 years		1,742			1,733
Digital set top units and installations		3 to 7 years		744			—
Machinery and equipment^(a)		3 to 20 years		3,131			2,985

				5,767			4,871
Less: accumulated depreciation and amortization^(b)				(3,352	)		(3,339	)

				2,415			1,532
Construction in progress				145			92

Total Property, plant and equipment, net			$	2,560		$	1,624

^(a)	The increase in Machinery and equipment primarily relates to technical equipment acquired in the Transaction. Includes capitalized software of approximately $1,189 million and $997 million as of June 30, 2018 and 2017, respectively.

^(b)	Includes accumulated amortization of capitalized software of approximately $734 million and $691 million as of June 30, 2018 and 2017, respectively.

Depreciation and amortization related to property, plant and equipment was $372 million, $358 million, and $415 million for the fiscal years ended June 30, 2018, 2017 and 2016, respectively. This includes amortization of capitalized software of $175 million, $168 million and $194 million for the fiscal years ended June 30, 2018, 2017 and 2016, respectively.

Total operating lease expense was approximately $183 million, $156 million and $164 million for the fiscal years ended June 30, 2018, 2017 and 2016, respectively.

Fixed Asset Impairments

During the fiscal year ended June 30, 2017, the Company recognized total fixed asset impairment charges of $679 million, primarily at News UK and News Corp Australia.

During the fourth quarter of fiscal 2017, as part of the Company’s long-range planning process, the Company reduced its outlook for the U.K. newspapers due to the impact of adverse print advertising and print circulation trends on the future expected performance of the business. As a result, the Company recognized a non-cash impairment charge of approximately $360 million related to the write-down of fixed assets at the U.K. newspapers. The write-down was comprised of approximately $252 million related to print sites, $85 million related to printing presses and print related equipment and $23 million related to capitalized software. Significant unobservable inputs utilized in the income approach valuation method were a discount rate of 8.5% and a -1.0% long term growth rate.

During the second quarter of fiscal 2017, the Company recognized a non-cash impairment charge of approximately $310 million primarily related to the write-down of fixed assets at the Australian newspapers. The write-down was a result of the impact of adverse trends on the future expected performance of the Australian newspapers, where revenue declines from continued weakness in the print advertising market accelerated during the second quarter. The write-down was comprised of approximately $149 million related to printing presses and print related equipment, $77 million related to facilities, $66 million related to capitalized software and $18 million related to tradenames. Significant unobservable inputs utilized in the income approach valuation method were a discount rate of 11.5% and no long-term growth.