Intangible Assets

Indefinite-Lived Intangible Assets

Our indefinite-lived intangible assets consists of FCC licenses, which were acquired primarily through FCC auctions and business combinations, certain of our trademarks, and goodwill. At March 31, 2017, we held 800 MHz, 1.9 GHz and 2.5 GHz FCC licenses authorizing the use of radio frequency spectrum to deploy our wireless services. As long as the Company acts within the requirements and constraints of the regulatory authorities, the renewal and extension of these licenses is reasonably certain at minimal cost. Accordingly, we have concluded that FCC licenses are indefinite-lived intangible assets. Our Sprint and Boost Mobile trademarks have also been identified as indefinite-lived intangible assets. Goodwill represents the excess of consideration paid over the estimated fair value of net tangible and identifiable intangible assets acquired in business combinations.

The following provides the activity of indefinite-lived intangible assets within the consolidated balance sheets:



	March 31, 2016		Net Additions			March 31, 2017
	(in millions)
FCC licenses	$	36,038	$	512	⁽¹⁾	$	36,550
Trademarks	4,035		—			4,035
Goodwill ⁽²⁾	6,575		4			6,579
	$	46,648	$	516		$	47,164



	March 31, 2015		Net Additions		March 31, 2016
	(in millions)
FCC licenses	$	35,952	$	86	$	36,038
Trademarks	4,035		—		4,035
Goodwill ⁽²⁾	6,575		—		6,575
	$	46,562	$	86	$	46,648

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(1)	Net additions within FCC licenses includes $85 million of spectrum acquired from the Shentel transaction (see Note 8. Long-Term Debt, Financing and Capital Lease Obligations) and an increase from spectrum license exchanges described below during the year ended March 31, 2017.


(2)	Through March 31, 2017 there is no accumulated impairment losses for goodwill.

Spectrum License Exchanges

In the second quarter of fiscal year 2016, we exchanged certain spectrum licenses with other carriers in non-cash transactions. As a result, we recorded a non-cash gain of $354 million, which represented the difference between the fair value and the net book value of the spectrum transferred to the other carriers. The gain was presented in "Other, net" in the consolidated statements of operations for the year ended March 31, 2017.

Assessment of Impairment

Our annual impairment testing date for goodwill and indefinite-lived intangible assets is January 1 of each year; however, we test for impairment between our annual tests if an event occurs or circumstances change that indicate that the asset may be impaired, or in the case of goodwill, that the fair value of the reporting unit is below its carrying amount. We did not record any impairment during the years ended March 31, 2017 and 2016. Since the SoftBank Merger in July 2013, actual results and expectations of net postpaid handset subscriber additions were lower than the forecasts used to allocate the purchase price to the assets acquired and liabilities assumed. During the year ended March 31, 2015, we determined that recoverability of the carrying amount of goodwill and the Sprint trade name should be evaluated for impairment and it was determined that the carrying value of the Sprint trade name exceeded its estimated fair value of $3.3 billion. Accordingly, during the year ended March 31, 2015 we recorded an impairment loss of $1.9 billion, which is included in "Impairments" in our consolidated statements of operations.

The determination of fair value requires considerable judgment and is highly sensitive to changes in underlying assumptions. Consequently, there can be no assurance that the estimates and assumptions made for the purposes of the goodwill, spectrum licenses, and Sprint and Boost Mobile trade names impairment tests will prove to be an accurate prediction of the future. Sustained declines in the Company’s operating results, number of wireless subscribers, future forecasted cash flows, growth rates and other assumptions, as well as significant, sustained declines in the Company’s stock price and related market capitalization could impact the underlying key assumptions and our estimated fair values, potentially leading to a future material impairment of goodwill or other indefinite-lived intangible assets.

Intangible Assets Subject to Amortization

Customer relationships are amortized using the sum-of-the-months' digits method, while all other definite-lived intangible assets are amortized using the straight-line method over the estimated useful lives of the respective assets. We reduce the gross carrying value and associated accumulated amortization when specified intangible assets become fully amortized. Amortization expense related to favorable spectrum and tower leases is recognized in "Cost of services" in our consolidated statements of operations.



		March 31, 2017							March 31, 2016
	Useful Lives	Gross Carrying Value		Accumulated Amortization			Net Carrying Value		Gross Carrying Value		Accumulated Amortization			Net Carrying Value
		(in millions)
Customer relationships	4 to 8 years	$	6,923	$	(5,053	)	$	1,870	$	6,923	$	(4,045	)	$	2,878
Other intangible assets:
Favorable spectrum leases	23 years	869		(138		)	731		881		(110		)	771
Favorable tower leases	7 years	589		(386		)	203		589		(302		)	287
Trademarks	34 years	520		(58		)	462		520		(43		)	477
Other	10 years	91		(37		)	54		83		(27		)	56
Total other intangible assets		2,069		(619		)	1,450		2,073		(482		)	1,591
Total definite-lived intangible assets		$	8,992	$	(5,672	)	$	3,320	$	8,996	$	(4,527	)	$	4,469



	Fiscal Year 2017		Fiscal Year 2018		Fiscal Year 2019		Fiscal Year 2020		Fiscal Year 2021
	(in millions)
Estimated amortization expense	$	883	$	667	$	462	$	258	$	104