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GOODWILL, INDEFINTE-LIVED INTANGIBLE ASSETS AND OTHER INTANGIBLE ASSETS
 12 Months Ended
Dec. 31, 2016
Goodwill and Intangible Assets Disclosure [Abstract]  
GOODWILL, INDEFINTE-LIVED INTANGIBLE ASSETS AND OTHER INTANGIBLE ASSETS
GOODWILL, INDEFINTE-LIVED INTANGIBLE ASSETS AND OTHER INTANGIBLE ASSETS:
 
Goodwill, which arises from the purchase price exceeding the assigned value of the net assets of an acquired business, represents the value attributable to unidentifiable intangible elements being acquired. Goodwill totaled $1,990.7 million and $1,931.1 million at December 31, 2016 and 2015, respectively.  The change in the carrying amount of goodwill was as follows (in thousands):
 
 
Broadcast
 
Other
 
Consolidated
Balance at December 31, 2014
 

 
 

 
 

Goodwill
$
2,377,613

 
$
513

 
$
2,378,126

Accumulated impairment losses
(413,573
)
 
—

 
(413,573
)
 
1,964,040

 
513

 
1,964,553

Acquisitions (a)
5,802

 
—

 
5,802

Measurement period adjustments related to prior year acquisitions
(42,237
)
 
—

 
(42,237
)
Change in assets held for sale (b)
—

 
2,975

 
2,975

Balance at December 31, 2015 (c)
 

 
 

 
 

Goodwill
2,341,178

 
3,488

 
2,344,666

Accumulated impairment losses
(413,573
)
 
—

 
(413,573
)
 
1,927,605

 
3,488

 
1,931,093

Acquisitions (a)
11,626

 
53,427

 
65,053

Measurement period adjustments related to prior year acquisitions
40

 
—

 
40

Disposition of assets (d)
(5,440
)
 
—

 
(5,440
)
Balance at December 31, 2016 (c)
 

 
 

 
 

Goodwill
2,347,404

 
56,915

 
2,404,319

Accumulated impairment losses
(413,573
)
 
—

 
(413,573
)
 
$
1,933,831

 
$
56,915

 
$
1,990,746

_______________________________________________________

(a)
In 2016 and 2015, we acquired goodwill as a result of acquisitions as discussed in Note 2. Acquisitions and Disposition of Assets.
(b)
We concluded in 2015 that certain non-media related assets that were classified as assets held for sale as of December 31, 2014 no longer met the held for sale criteria.
(c)
Approximately $0.8 million of goodwill relates to consolidated VIEs as of December 31, 2016 and 2015.
(d)
Amounts relate to the 2016 sale of broadcast assets as discussed in Note 2. Acquisitions and Disposition of Assets.
For our annual goodwill impairment tests in 2016, 2015 and 2014, we concluded that it was more-likely-than-not that goodwill was not impaired for the reporting units in which we performed a qualitative assessment.  For one reporting unit in 2016, we elected to perform a quantitative assessment and concluded that its fair value substantially exceeded its carrying value. The qualitative factors reviewed during our annual assessments, indicated stable or improving margins and favorable or stable forecasted economic conditions including stable discount rates and comparable or improving business multiples. Additionally, the results of prior quantitative assessments supported significant excess fair value over carrying value of our reporting units. We did not have any indicators of impairment in any interim period in 2016, 2015, or 2014, and therefore did not perform interim impairment tests for goodwill during those periods.

The key assumptions used to determine the fair value of our broadcast reporting unit consisted primarily of significant unobservable inputs (Level 3 fair value inputs), including discount rates, estimated cash flows, profit margins and growth rates.  The discount rate used to determine the fair value of our broadcast reporting unit is based on a number of factors including market interest rates, a weighted average cost of capital analysis based on the target capital structure for a television broadcasting company, and includes adjustments for market risk and company specific risk.  Estimated cash flows are based upon internally developed estimates and the growth rates and profit margins are based on market studies, industry knowledge and historical performance. 



As of December 31, 2016 and 2015, the carrying amount of our indefinite-lived intangible assets was as follows (in thousands):

 
Broadcast
 
Other
 
Consolidated
Balance at December 31, 2014
$
135,075

 
$
—

 
$
135,075

Acquisitions (a)
992

 
—

 
992

Sale of assets
(175
)
 
—

 
(175
)
Measurement period adjustments related to prior year acquisitions
(3,427
)
 
—

 
(3,427
)
Balance at December 31, 2015 (b)
132,465

 
—

 
132,465

Acquisitions (a)
2,406

 
23,400

 
25,806

Disposition of assets
(1,965
)
 
—

 
(1,965
)
Balance at December 31, 2016 (b) (c)
$
132,906

 
$
23,400

 
$
156,306


(a)
In 2016 and 2015, we acquired indefinite-lived intangible assets as a result of acquisitions as discussed in Note 2. Acquisitions and Disposition of Assets.
(b)
Approximately $15.7 million and $17.6 million of indefinite-lived intangible assets relate to consolidated VIEs as of December 31, 2016 and 2015, respectively.
(c)
Our indefinite-lived intangible assets in Broadcast relates to broadcast licenses and our indefinite-lived intangible assets in Other relates to trade names.
 
We did not have any indicators of impairment for our indefinite-lived intangible assets in any interim period in 2016 or 2015, and therefore did not perform interim impairment tests during those periods. We performed our annual impairment tests for indefinite-lived intangibles in the fourth quarter of 2016 and 2015 and as a result of our qualitative and quantitative assessments, we recorded no impairment. We performed our annual impairment tests for indefinite-lived intangibles in the fourth quarter of 2014 and as a result of our qualitative and/or quantitative assessments we recorded $3.2 million of impairment charges, included within amortization of definite-lived intangible and other assets within the consolidated statement of operations, related to broadcast licenses with a carrying value of $21.1 million, compared to their estimated fair value of $17.9 million, as a result of a decrease in the projected future market revenues related to our radio broadcast licenses in Seattle, WA.
 
The key assumptions used to determine the fair value of our broadcast licenses consisted primarily of significant unobservable inputs (Level 3 fair value inputs), including discount rates, estimated market revenues, normalized market share, normalized profit margin, and estimated start-up costs. The qualitative factors for our broadcast licenses indicated an increase in market revenues, stable market shares and stable cost factors. The revenue, expense and growth rates used in determining the fair value of our broadcast licenses remained constant or increased slightly from 2015 to 2016.  The growth rates are based on market studies, industry knowledge and historical performance. The discount rates used to determine the fair value of our broadcast licenses did not change significantly over the last three years. The discount rate is based on a number of factors including market interest rates, a weighted average cost of capital analysis based on the target capital structure for a television station, and includes adjustments for market risk and company specific risk.
 
The following table shows the gross carrying amount and accumulated amortization of definite-lived intangibles (in thousands):
 
 As of December 31, 2016
 
Gross Carrying Value
 
Accumulated Amortization
 
Net
Amortized intangible assets:
 
 
 
 
 
   Network affiliation (a)
$
1,398,451

 
$
(427,484
)
 
$
970,967

   Customer Relationships (a)
1,102,591

 
(294,114
)
 
808,477

   Other (b)
243,253

 
(78,294
)
 
164,959

Total
$
2,744,295

 
$
(799,892
)
 
$
1,944,403

 
 
As of December 31, 2015
 
Gross Carrying Value
 
Accumulated Amortization
 
Net
Amortized intangible assets:
 
 
 
 
 
   Network affiliation (a)
$
1,378,425

 
$
(343,729
)
 
$
1,034,696

   Customer Relationships (a)
806,727

 
(225,176
)
 
581,551

   Other (b)
193,594

 
(58,271
)
 
135,323

Total
$
2,378,746

 
$
(627,176
)
 
$
1,751,570

_______________________________________________________

(a)
Changes between the gross carrying value from December 31, 2015 to December 31, 2016, relate to acquisitions in 2016, as discussed in Note 2. Acquisitions and Disposition of Assets.
(b)
The increase in other intangible assets is primarily due to the purchase of additional alarm monitoring contracts of $40.2 million.
 
Definite-lived intangible assets and other assets subject to amortization are being amortized on a straight-line basis over their estimated useful lives which generally range from 5 to 25 years.  The total weighted average useful life of all definite-lived intangible assets and other assets subject to amortization acquired as a result of the acquisitions discussed in Note 2. Acquisitions and Disposition of Assets is 14 years.  The amortization expense of the definite-lived intangible and other assets for the years ended December 31, 2016, 2015 and 2014 was $183.8 million, $161.5 million and $125.5 million, respectively.  We analyze specific definite-lived intangibles for impairment when events occur that may impact their value in accordance with the respective accounting guidance for long-lived assets.  There were no impairment charges recorded for the years ended December 31, 2016, 2015 and 2014.
 
The following table shows the estimated amortization expense of the definite-lived intangible assets for the next five years (in thousands):
 
For the year ended December 31, 2017
$
175,942

For the year ended December 31, 2018
174,593

For the year ended December 31, 2019
173,586

For the year ended December 31, 2020
173,006

For the year ended December 31, 2021
171,988

Thereafter
1,075,288

 
$
1,944,403