Wireless Licenses, Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Wireless Licenses, Goodwill and Other Intangible Assets


Note 4. Wireless Licenses, Goodwill, and Other Intangible Assets

Wireless Licenses

The carrying amounts of Wireless licenses are as follows:


	At September 30,		At December 31,
(dollars in millions)	2020		2019
Wireless licenses	$	95,958	$	95,059

At September 30, 2020 and 2019, approximately $6.9 billion and $6.5 billion, respectively, of wireless licenses were under development for commercial service for which we were capitalizing interest costs. We recorded approximately $171 million and $248 million of capitalized interest on wireless licenses for the nine months ended September 30, 2020 and 2019, respectively.

In March 2020, we reclassified substantially all of our 39 GHz wireless licenses, including capitalized interest, with a carrying value of $2.8 billion to assets held for sale in connection with the FCC's incentive auction, Auction 103. As a result, these wireless licenses were adjusted down to their fair value of $1.6 billion resulting in a pre-tax loss of $1.2 billion ($914 million after-tax) for the nine months ended September 30, 2020. The new reconfigured licenses were received in the second quarter 2020 and had a value of $3.4 billion. See Note 3 for additional information regarding spectrum license transactions.

During 2020, we renewed various wireless licenses in accordance with FCC regulations. The average renewal period for these licenses was 10 years.

Goodwill

Changes in the carrying amount of Goodwill are as follows:


(dollars in millions)	Consumer		Business		Other		Total
Balance at January 1, 2020 ⁽¹⁾	$	17,104	$	7,269	$	16	$	24,389
Acquisitions ⁽²⁾	109		296		—		405
Reclassifications, adjustments and other	—		5		—		5
Balance at September 30, 2020 ⁽¹⁾	$	17,213	$	7,570	$	16	$	24,799

⁽¹⁾Other Goodwill is net of accumulated impairment charges of $4.8 billion, related to our Media reporting unit.

⁽²⁾Changes in goodwill due to acquisitions is related to BlueJeans and an other insignificant transaction. See Note 3 for additional information.

Other Intangible Assets

The following table displays the composition of Other intangible assets, net as well as the respective amortization period:


	At September 30, 2020										At December 31, 2019
(dollars in millions)	Gross Amount		Accumulated Amortization		Net Amount		Gross Amount		Accumulated Amortization		Net Amount
Customer lists (8 to 13 years)	$	4,048	$	(1,854)	$	2,194	$	3,896	$	(1,511)	$	2,385
Non-network internal-use software (5 to 7 years)	22,229		(15,769)		6,460		20,530		(14,418)		6,112
Other (2 to 25 years)	2,001		(1,056)		945		1,967		(966)		1,001
Total	$	28,278	$	(18,679)	$	9,599	$	26,393	$	(16,895)	$	9,498

The amortization expense for Other intangible assets was as follows:


	Three Months Ended		Nine Months Ended
(dollars in millions)	September 30,		September 30,
2020	$	621	$	1,818
2019	580		1,704

The estimated future amortization expense for Other intangible assets for the remainder of the current year and next 5 years is as follows:


Years	(dollars in millions)
Remainder of 2020	$	679
2021	2,234
2022	1,924
2023	1,555
2024	1,159
2025	800