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Goodwill and Intangible Assets
12 Months Ended
Dec. 31, 2012
Goodwill and Intangible Assets [Abstract]  
Goodwill and Intangible Assets

Note 4: Goodwill and Intangible Assets

As of December 31, 2012 and 2011, the Company had $725,399 in FCC licenses which are indefinite-lived intangible assets not subject to amortization. Based on the Company’s annual impairment assessments performed as of December 31, 2012, 2011 and 2010, no impairments of FCC licenses were identified.

As of December 31, 2012 and 2011, the Company had $423,873 in goodwill. Based on the Company’s annual impairment tests of goodwill as of December 31, 2012, 2011 and 2010, the Company determined that no impairments of goodwill existed.

 

Fair value estimates are inherently sensitive, particularly with respect to FCC licenses. In two of the Company’s 15 markets, the estimated fair value of its FCC licenses is less than 30 percent greater than their respective carrying values, with the closest market having an excess of estimated fair value over carrying value of 24 percent. A significant reduction in the fair value of the FCC licenses in any of these two markets could result in an impairment charge. The carrying value of the FCC licenses in those two markets represents approximately $231,415 of the Company’s total $725,399 of FCC licenses at December 31, 2012. Goodwill at the Company’s reporting units is somewhat less sensitive as, collectively, reporting units with estimated fair values exceeding their carrying values by more than 30 percent represent over 88 percent of the total investments in goodwill as of December 31, 2012, and impairment charges related to FCC licenses that are recorded in any period will reduce the carrying values of those applicable reporting units prior to the goodwill impairment evaluation. In the Company’s closest market having excess of estimated fair value over carrying values, reporting unit fair value exceeded carrying value by approximately 23 percent. If some or all of the aforementioned key estimates or assumptions change in the future, the Company may be required to record additional impairment charges related to its goodwill and indefinite-lived intangible assets.

The fair value measurements for the Company’s implied goodwill and FCC licenses use significant unobservable Level 3 inputs which reflect its own assumptions about the inputs that market participants would use in measuring fair value, including assumptions about risk. The key assumptions used to determine fair value of the Company’s reporting units and FCC licenses are discussed in Note 1.

A summary of the changes in the Company’s recorded goodwill is below:

 

                 
     2012     2011  

Balance at January 1

  $ 423,873     $ 423,873  

Goodwill impairment

           

Balance at December 31

  $ 423,873     $ 423,873