GOODWILL AND INTANGIBLES

Changes in the carrying amount of goodwill are as follows (in thousands):



	Gross Carrying Amount
	EGM		Table Products		Interactive			Total
Balance at December 31, 2016	$	242,796	$	3,400	$	4,828		$	251,024
Foreign currency adjustments	855		—		—			855
Acquisition	23,217		3,241		—			26,458
Balance at December 31, 2017	266,868		6,641		4,828			278,337
Foreign currency adjustments	11		—		(182		)	(171		)
Purchase accounting adjustment	200		—		—			200
Acquisition	—		—		3,725			3,725
Impairment	$	—	$	—	$	(4,828	)	$	(4,828	)
Balance at December 31, 2018	$	267,079	$	6,641	$	3,543		$	277,263

During the year ended December 31, 2018, we recorded a measurement period adjustment to the purchase price allocation of Rocket for $0.2 million that increased goodwill and decreased intangible assets. The adjustment was recorded based on our final valuation of the intangible assets acquired from Rocket.

The Company performed a qualitative assessment as of October 1, 2018 on the EGM and Interactive Real-Money Gaming reporting units which concluded it was not more-likely-than-not the reporting units were impaired. The Table Product reporting unit quantitative test resulted in a significant amount of cushion between the fair value and carrying value of this reporting unit.

For the Social Interactive reporting unit, which had a goodwill carrying value of $4.8 million as of the assessment date, the Company performed a quantitative, or “Step 1” analysis in the current year in which we determined the entire balance of goodwill was impaired. In performing the Step 1 goodwill impairment test for our Interactive Social reporting unit, we estimated the fair value of the Interactive Social reporting unit using an income approach that analyzed projected discounted cash flows. We used projections of revenues and operating costs with estimated growth rates during the forecast period, capital expenditures and cash flows that considered historical and estimated future results and general economic and market conditions, as well as the estimated impact of planned business and operational strategies. In the fourth quarter of the year ended December 31, 2018, during the annual budgeting process the Company decided to change its strategy with regard to marketing and user acquisition activities that drive its B2C Social offerings. The strategic decision to significantly cut spending in this area and to focus completely on the B2B Social business, was the primary reason for a reduction in the projected discounted cash flows that were used in the impairment test. The estimates and assumptions used in the discounted cash flow analysis included a terminal year long-term growth rate of 3.0% and an overall discount rate of 19% based on our weighted average cost of capital for the Company and premiums for the small size of the reporting unit and forecast risk.

Intangible assets consist of the following (in thousands):



		December 31, 2018							December 31, 2017
	Useful Life (years)	Gross Value		Accumulated Amortization			Net Carrying Value		Gross Value		Accumulated Amortization			Net Carrying Value
Indefinite lived trade names	Indefinite	$	12,126	$	—		$	12,126	$	12,126	$	—		$	12,126
Trade and brand names	7	14,730		(10,681		)	4,049		14,730		(7,642		)	7,088
Customer relationships	7	188,772		(93,358		)	95,413		188,419		(69,564		)	118,855
Contract rights under development and placement fees	1 - 7	19,620		(14,367		)	5,253		16,834		(9,860		)	6,974
Gaming software and technology platforms	1 - 7	151,055		(82,371		)	68,682		141,231		(67,189		)	74,042
Intellectual property	10 - 12	17,205		(5,830		)	11,375		17,180		(3,978		)	13,202
		$	403,508	$	(206,607	)	$	196,898	$	390,520	$	(158,233	)	$	232,287

Intangible assets are amortized over their respective estimated useful lives ranging from one to twelve years. Amortization expense related to intangible assets was $45.1 million, $44.4 million and $53.2 million for the years ended December 31, 2018, 2017 and 2016, respectively.

Management reviews intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. We recorded impairments related to internally developed gaming titles and assets associated with terminated development agreements of $1.3 million for the year ended December 31, 2018. For the year ended December 31, 2017, the Company recognized impairment charges related to internally developed gaming titles of $0.6 million.

The Company enters into development agreements and placement fee agreements with certain customers to secure floor space under lease agreements for its gaming machines. Amounts paid in connection with the development agreements are repaid to the Company in accordance with the terms of the agreement, whereas placements fees are not reimbursed. For development agreements in the form of a loan, interest income is recognized on the repayment of the notes based on the stated rate or, if not stated explicitly in the development agreement, on an imputed interest rate. If the stated interest rate is deemed to be other than a market rate or zero, a discount is recorded on the note receivable as a result of the difference between the stated and market rate and a corresponding intangible asset is recorded. The intangible asset is recognized in the financial statements as a contract right under development agreement and amortized as a reduction in revenue over the term of the agreement. Placement fees can be in the form of cash paid upfront or free lease periods and are accreted over the life of the contract and the expense is recorded as a reduction of revenue. We recorded a reduction of gaming operations revenue from the accretion of contract rights under development agreements and placement fees of $4.6 million, $4.7 million and $4.7 million for the years ended December 31, 2018, 2017 and 2016, respectively.

The estimated amortization expense of definite-lived intangible assets as well as the accretion of contract rights under development and placement fees, for each of the next five years and thereafter is as follows (in thousands):



For the year ended December 31,	Amortization Expense		Placement Fee Accretion
2019	$	39,742	$	3,380
2020	33,521		371
2021	18,824		371
2022	17,801		310
2023	17,510		289
Thereafter	52,121		531
Total	$	179,519	$	5,253