Intangible Assets And Goodwill

6 Months Ended

Jun. 28, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

Amortized intangible assets were comprised of the following:



	June 28, 2014				December 31, 2013
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Completed technology	$	35	$	25	$	24	$	24
Patents	8		4		8		3
Customer-related	13		6		6		6
Other intangibles	17		14		15		14
	$	73	$	49	$	53	$	47

Amortization expense on intangible assets was $1 million for the three months ended June 28, 2014 and $2 million for the six months ended June 28, 2014. There was no amortization expense incurred during the three or six months ended June 29, 2013. As of June 28, 2014, annual amortization expense is estimated to be $4 million in 2014, 2015, and 2016, and $3 million in 2017 and 2018.

Amortized intangible assets, excluding goodwill, were comprised of the following by segment:



	June 28, 2014				December 31, 2013
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Products	$	70	$	49	$	53	$	47
Services	3		—		—		—
	$	73	$	49	$	53	$	47

Goodwill

During the second quarter of 2014 as a result of the reclassification of the Enterprise business to discontinued operations, the Company determined the reportable segments and reporting units of its continuing operations. The Company now has two segments, Products and Services, which are the same as its reporting units. The Company's goodwill was allocated to its new reporting units based on their relative fair values. In conjunction with the reporting unit change in the second quarter of 2014, the Company evaluated its goodwill for impairment concluding it is more-likely-than-not that the fair values of each of its reporting units exceed their respective carrying values. As such, a goodwill impairment was not recorded.

The following table displays a rollforward of the carrying amount of goodwill by segment from January 1, 2014 to June 28, 2014:



	Products		Services		Total
Balance as of January 1, 2014
Aggregate goodwill	$	249	$	112	$	361
Accumulated impairment losses	—		—		—
Goodwill, net of impairment losses	$	249	$	112	$	361
Goodwill acquired	15		7		22
Balance as of June 28, 2014
Aggregate goodwill	$	264	$	119	$	383
Accumulated impairment losses	—		—		—
Goodwill, net of impairment losses	$	264	$	119	$	383

On December 31, 2013, the Company completed the acquisition of a communications software provider in push-to-talk-over-broadband applications for a gross purchase price of $48 million. During the six months ended June 28, 2014, the Company completed the purchase accounting for this acquisition, recognizing $22 million of goodwill and $20 million of identifiable intangible assets. The results of operations for this acquisition have been included in the Company’s condensed consolidated statement of operations subsequent to the acquisition date. The pro forma effects of this acquisition were not significant.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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