Long-lived Assets

Property and Equipment, Net

The details of our property and equipment and the related accumulated depreciation are set forth below:



	Estimated useful life at December 31, 2013	December 31,
	Estimated useful life at December 31, 2013	2013			2012
		in millions

Distribution systems	4 to 30 years	$	25,193.2		$	15,372.3
Customer premises equipment	3 to 5 years	6,126.0			4,162.6
Support equipment, buildings and land	3 to 40 years	3,581.9			2,282.1
		34,901.1			21,817.0
Accumulated depreciation		(10,926.2		)	(8,379.4		)
Total property and equipment, net		$	23,974.9		$	13,437.6

Depreciation expense of our continuing operations related to our property and equipment was $3,499.6 million, $2,201.4 million and $2,035.4 million during 2013, 2012 and 2011, respectively. Depreciation expense of our discontinued operations related to our property and equipment was $11.5 million, $12.3 million and $129.6 million during 2013, 2012 and 2011, respectively.

At December 31, 2013 and 2012, the amount of property and equipment, net, recorded under capital leases was $1,877.3 million and $1,206.0 million, respectively. Most of these amounts relate to assets included in our distribution systems category. Depreciation of assets under capital leases of our continuing operations is included in depreciation and amortization in our consolidated statements of operations.

During 2013, 2012 and 2011, we recorded non-cash increases to our property and equipment related to assets acquired under capital leases of $143.0 million, $63.1 million and $38.2 million, respectively. In addition, during 2013, 2012 and 2011, we recorded non-cash increases related to vendor financing arrangements of $573.5 million, $246.5 million and $101.4 million, respectively, which amounts exclude related value-added taxes of $46.0 million, $28.5 million and $13.7 million, respectively, that were also financed by our vendors under these arrangements.

In May 2012, through VTR Wireless, we began offering mobile services in Chile through a combination of our own wireless network and a third-party wireless access arrangement. During the second quarter of 2013, we began exploring strategic alternatives with respect to VTR Wireless’ mobile operations, including alternatives that involved the use of expanded mobile virtual network operator (MVNO) arrangements. Effective April 1, 2013, we reduced the useful lives of VTR Wireless’ network equipment to reflect our then expectation that we would enter into a new MVNO arrangement and cease commercial use of VTR Wireless’ mobile network during the fourth quarter of 2013. In September 2013, (i) VTR Wireless completed the process of migrating its mobile traffic to a third-party wireless network pursuant to its existing roaming agreement and (ii) VTR Wireless ceased commercial use of its mobile network, which resulted in a further reduction in the useful lives of VTR Wireless’ network equipment. As a result of the aforementioned reductions in useful lives, VTR Wireless recognized aggregate incremental depreciation expense of $98.3 million during 2013. In connection with the foregoing, we have recorded restructuring charges totaling $84.9 million during the third and fourth quarters of 2013. These restructuring charges include the discounted amount of (i) the remaining payments due under VTR Wireless’ tower and real estate operating leases of $71.5 million and (ii) certain other required payments associated with VTR Wireless’ mobile network. For information regarding our restructuring charges, see note 13.

In December 2013, VTR Wireless amended its existing roaming agreement with an agreement that provides for a full MVNO relationship. The amended agreement sets forth the terms for a more comprehensive arrangement with the third-party network operator and includes, among other items, terms that will allow VTR Wireless to decrease the variable costs associated with its wireless business and increase its ability to design its own tariff and commercial strategies.

Goodwill

Changes in the carrying amount of our goodwill during 2013 are set forth below:



	January 1, 2013		Acquisitions and related adjustments		Reclassification of Chellomedia Disposal Group to discontinued operations			Foreign currency translation adjustments and other			December 31, 2013
	in millions
European Operations Division:
U.K. (Virgin Media)	$	—	$	9,000.8	$	—		$	597.4		$	9,598.2
Germany (Unitymedia KabelBW)	3,770.3		—		—			169.1			3,939.4
Belgium (Telenet)	2,158.3		—		—			96.8			2,255.1
The Netherlands	1,206.2		—		—			54.2			1,260.4
Switzerland	3,107.9		0.6		—			88.9			3,197.4
Other Western Europe	1,031.5		—		—			48.2			1,079.7
Total Western Europe	11,274.2		9,001.4		—			1,054.6			21,330.2
Central and Eastern Europe	1,509.5		—		—			10.6			1,520.1
Total European Operations Division	12,783.7		9,001.4		—			1,065.2			22,850.3
Chile (VTR Group)	558.0		—		—			(49.5		)	508.5
Corporate and other	535.9		77.2		(223.4		)	0.3			390.0
Total (a)	$	13,877.6	$	9,078.6	$	(223.4	)	$	1,016.0		$	23,748.8

________________


(a)	With the exception of Other Western Europe, Central and Eastern Europe and our corporate and other category, our reporting units for purposes of goodwill impairment testing correspond to our reportable segments, as set forth in the above table. For information concerning the reporting units included within the Other Western Europe and Central and Eastern Europe reportable segments, see note 17.

Based on the results of our October 1, 2013 goodwill impairment test, a hypothetical decline of 20% or more in the fair value of Liberty Puerto Rico, which is included in our corporate and other category, could result in the need to record a goodwill impairment charge. At December 31, 2013, the goodwill associated with the Liberty Puerto Rico reporting unit was $347.0 million. If, among other factors, (i) our equity values were to decline significantly, or (ii) the adverse impacts of economic, competitive, regulatory or other factors were to cause our results of operations or cash flows to be worse than anticipated, we could conclude in future periods that impairment charges are required in order to reduce the carrying values of our goodwill and, to a lesser extent, other long-lived assets. Any such impairment charges could be significant.

At December 31, 2013 and 2012 and based on exchange rates as of those dates, the accumulated goodwill impairments of our continuing operations were $239.6 million and $230.8 million, respectively. These amounts represent accumulated impairments related to our broadband communications operations in Romania, which operations are included within the European Operations Division’s Central and Eastern Europe segment.

Changes in the carrying amount of our goodwill during 2012 are set forth below:



	January 1, 2012		Acquisitions and related adjustments			Foreign currency translation adjustments		December 31, 2012
			in millions
European Operations Division:
Germany (Unitymedia KabelBW)	$	3,703.3	$	(0.8	)	$	67.8	$	3,770.3
Belgium (Telenet)	2,119.5		—			38.8		2,158.3
The Netherlands	1,181.7		2.9			21.6		1,206.2
Switzerland	3,026.8		1.1			80.0		3,107.9
Other Western Europe	1,013.0		—			18.5		1,031.5
Total Western Europe	11,044.3		3.2			226.7		11,274.2
Central and Eastern Europe	1,404.2		0.8			104.5		1,509.5
Total European Operations Division	12,448.5		4.0			331.2		12,783.7
Chile (VTR Group)	514.3		—			43.7		558.0
Corporate and other	326.5		204.3			5.1		535.9
Total	$	13,289.3	$	208.3		$	380.0	$	13,877.6

Intangible Assets Subject to Amortization, Net

The details of our intangible assets subject to amortization are set forth below:



	Estimated useful life at December 31, 2013	December 31, 2013							December 31, 2012
	Estimated useful life at December 31, 2013	Gross carrying amount		Accumulated amortization			Net carrying amount		Gross carrying amount		Accumulated amortization			Net carrying amount
		in millions

Customer relationships	4 to 15 years	$	8,116.7	$	(2,458.4	)	$	5,658.3	$	4,117.5	$	(1,780.0	)	$	2,337.5
Other	2 to 15 years	288.1		(151.0		)	137.1		379.3		(135.5		)	243.8
Total		$	8,404.8	$	(2,609.4	)	$	5,795.4	$	4,496.8	$	(1,915.5	)	$	2,581.3

In December 2013, Telenet’s management determined that it would no longer be able to utilize its spectrum rights as a result of the conclusion of negotiations with network operators in Belgium and the absence of regulatory alternatives. This resulted in a triggering event with respect to the intangible asset related to Telenet’s spectrum rights and, after performing an impairment analysis, Telenet recorded an impairment charge of $73.0 million during the fourth quarter of 2013 to reduce the carrying amount of this intangible asset to zero.

Amortization of intangible assets with finite useful lives of our continuing operations was $776.8 million, $460.1 million and $388.9 million during 2013, 2012 and 2011, respectively. Amortization of intangible assets with finite useful lives of our discontinued operations was $17.6 million, $17.3 million and $18.4 million during 2013, 2012 and 2011, respectively. Based on the amortizable intangible asset balances of our continuing operations at December 31, 2013, we expect that amortization expense will be as follows for the next five years and thereafter. The U.S. dollar equivalents of such amortization expense amounts as of December 31, 2013 are presented below (in millions):



2014	$	1,043.4
2015	1,012.0
2016	953.8
2017	810.8
2018	752.5
Thereafter	1,222.9
Total	$	5,795.4

Other Indefinite-lived Intangible Assets

At December 31, 2013 and 2012, franchise rights and other indefinite-lived intangible assets aggregating $470.2 million and $558.2 million, respectively, were included in other assets, net, in our consolidated balance sheets.