Capitalized Software Development Costs

9 Months Ended

Sep. 30, 2013

Capitalized Software Development Costs [Abstract]

Capitalized Software Development Costs

10.  Capitalized Software Development Costs

Capitalized software development costs consisted of the following:

	September 30, 2013			December 31, 2012
Software development costs	$	1,116,700		$	573,100
Accumulated amortization		(457,100	)		(350,000	)
	$	659,600		$	223,100

Amortization of capitalized software development costs is a component of costs of revenue. Capitalized software development costs amortization aggregated $24,000 and $107,100 during the three and nine-month periods ended September 30, 2013, respectively, and $41,500 and $124,600 during the three and nine-month periods ended September 30, 2012, respectively.

We recorded $79,100 and $543,600 of capitalized software development costs during the three and nine-month periods ended September 30, 2013, respectively.  Such capitalized costs were incurred in the development of our new product hopTo, and are comprised primarily of employee costs and the cost of licenses to third party software that will be used by our hopTo product upon its commercial release.  We anticipate releasing the first commercial version of hopTo in the fourth quarter time frame and will begin amortizing its capitalized software development costs accordingly (See Note 18).  Had these costs not met the criteria for capitalization, they would have been expensed.  We did not record any capitalized software development costs during the nine-month period ended September 30, 2012.