Restructuring and Asset Impairment Charges

3 Months Ended

12 Months Ended

Mar. 31, 2016

Dec. 31, 2015

Restructuring and Related Activities [Abstract]

Restructuring and Asset Impairment Charges

NOTE 13—RESTRUCTURING AND ASSET IMPAIRMENT CHARGES

On September 21, 2015, the board of directors of the Company approved a plan to transition the Company’s wireless internet business from a 5Ghz to a 60Ghz-based network technology that provides higher data transmission speeds. The Company will continue to service its existing 5Ghz subscribers. As a result of this transition, the Company discontinued the build-out of additional 5Ghz networks and the installation of new 5Ghz customers. The Company expects the shift to the new technology will begin with a set of 60Ghz test installations in 2016.

Restructuring and asset impairment charges for the three months ended March 31, 2016 were as follows (in thousands):

	Three Months Ended March 31, 2016
Contract termination costs	$	19
Employee severance and termination benefits		26
Total restructuring and asset impairment charges	$	45

	Contract termination costs			Employee severance and termination benefits			Total
Accrued restructuring balance as of December 31, 2015	$	3,954		$	321		$	4,275
Restructuring and impairment charges		19			26			45
Cash payments		(1,349	)		(143	)		(1,492	)
Accrued restructuring balance as of March 31, 2016	$	2,624		$	204		$	2,828

The unpaid portion of the restructuring charge is expected to be paid within 12 months and is recorded in accrued expenses and other current liabilities on the consolidated balance sheets as of March 31, 2016.

Additional charges may be incurred in the future for facility-related or other restructuring activities as the Company continues to align resources to meet the needs of the business.

NOTE 3—RESTRUCTURING AND ASSET IMPAIRMENT CHARGES

During the third quarter of 2015, the board of directors approved a plan to transition the Company’s Wireless Internet business from a 5Ghz to a 60Ghz-based network technology and the Company ceased the build-out of 5Ghz networks and stopped the installation of new customers. The Company expects the shift to the new 60Ghz technology will begin with a set of test installations in 2016.

Restructuring and asset impairment charges were as follows (in thousands):

	Year ended December 31, 2015
Asset impairments	$	53,228
Contract termination costs		4,767
Employee severance and termination benefits		1,202
Total restructuring and asset impairment charges	$	59,197

During the year ended December 31, 2014, the Company did not incur any restructuring and asset impairment charges.

	Asset impairments			Contract termination costs			Employee severance and termination benefits			Total
Accrued restructuring balance as of December 31, 2014	$	—		$	—		$	—		$	—
Restructuring and impairment charges		53,228			4,767			1,202			59,197
Cash payments		(10	)		(623	)		(881	)		(1,514	)
Non-cash settlements		(53,218	)		(190	)		—			(53,408	)
Accrued restructuring balance as of December 31, 2015	$	—		$	3,954		$	321		$	4,275

As a result of this transition, the existing 5Ghz network did not reach full deployment as anticipated and the Company has recorded a non-cash asset impairment charge of $53.2 million during the year ended December 31, 2015. The impairment charge included a write down of the Company’s network assets, subscriber acquisition costs, certain intellectual property and goodwill (See Note 10). Assets related to the 5Ghz network were determined to have no fair value and were fully impaired.

The Company also recorded cash-based restructuring charges of $6.0 million during the year ended December 31, 2015 related to employee severance and termination benefits as well as the write off of certain vendor contracts. The unpaid portion of the restructuring charge is expected to be paid within 12 months and is recorded in accrued expenses and other current liabilities on the consolidated balance sheets as of December 31, 2015.

Additional charges may be incurred in the future for facility-related or other restructuring activities as the Company continues to align resources to meet the needs of the business.