Fair Value Measurements

12 Months Ended

Dec. 31, 2012

Fair Value Measurements

Fair Value Measurements

Note 3 — Fair Value Measurements

We follow the fair value measurement and disclosure provisions of FASB ASC Topic 820, “Fair Value Measurements and Disclosures,” relating to financial and nonfinancial assets and liabilities.  The fair value of an asset or liability is the price that would be received to sell that asset or paid to transfer that liability in an orderly transaction occurring in the principal market (or most advantageous market in the absence of a principal market) for such asset or liability.  FASB ASC Topic 820 includes a fair value hierarchy, which is intended to increase consistency and comparability in fair value measurements and related disclosures.  The fair value hierarchy is based on inputs to valuation techniques, which are used to measure fair value and which are either observable or unobservable.  Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon their own market assumptions.  The fair value hierarchy consists of the following three levels:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market-based inputs or unobservable inputs which are corroborated by market data.

Level 3: Unobservable inputs which are not corroborated by market data.

Financial Assets and Financial Liabilities - The estimated carrying and fair values of our financial instruments in the financial statements were as follows at December 31 (dollar amounts in thousands):

	2012				2011
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Long-term debt	$	347,267	$	217,104	$	363,300	$	319,788

The fair value of our long-term debt is classified as Level 2 and is estimated based on current interest rates for similar debt of the same remaining maturities and quoted market prices, except for capital leases and our revolving loan commitment borrowings, which are reported at carrying value.  For our capital leases and revolving loan commitment borrowings, the carrying value approximates the fair value.  The fair value of our long-term debt is strictly hypothetical and not indicative of what we are required to pay under the terms of our debt instruments.  See Note 8 for further disclosures regarding long-term debt and our Credit Facility.

Nonfinancial Assets and Nonfinancial Liabilities — Certain assets and liabilities measured at fair value on a non-recurring basis could include nonfinancial assets and nonfinancial liabilities measured at fair value in the goodwill impairment tests and intangible assets and other nonfinancial long-lived assets measured at fair value for impairment assessment.  The fair value of our goodwill and intangible assets are determined based on valuation techniques using the income approach, utilizing a discounted cash flow analysis based on key assumptions and estimates.  Accordingly, the fair values of our goodwill and intangible assets are classified as Level 3.

In 2012, as a result of reduced profitability, our cost method investment in a high-speed Internet service provider with a carrying amount of $2.8 million was written down to its Level 3 fair value of $2.2 million, resulting in an impairment charge of $0.6 million.  During the year ended December 31, 2011, the same investment was written down from its carrying amount of $3.0 million to its Level 3 fair value of $2.8 million, resulting in an impairment charge of $0.2 million.  There was no impairment charge incurred during the year ended December 31, 2010.