Goodwill

12 Months Ended

Dec. 31, 2012

Goodwill:

Goodwill

10.       Goodwill

The changes in the carrying amount of goodwill by reporting unit for the years ended December 31, 2012 and 2011 are as follows (amounts in millions):

		Activision		Blizzard		Distribution		Total
Balance at December 31, 2010		$	6,942	$	178	$	12	$	7,132
	Tax benefit credited to goodwill		(12)		---		---		(12)
	Issuance of contingent consideration		3		---		---		3
	Impairment of goodwill		---		---		(12)		(12)
Balance at December 31, 2011		$	6,933	$	178	$	---	$	7,111
	Tax benefit credited to goodwill		(5)		---		---		(5)
Balance at December 31, 2012		$	6,928	$	178	$	---	$	7,106

Issuance of contingent consideration consists of additional purchase consideration paid or accrued in relation to previous acquisitions. The tax benefit credited to goodwill represents the tax deduction resulting from the exercise of stock options that were outstanding and vested at the consummation of the Business Combination and included in the purchase price of Activision, Inc. to the extent that the tax deduction did not exceed the fair value of those options. Conversely, to the extent that the tax deduction did exceed the fair value of those options, the tax benefit is credited to accumulated paid in capital.

During our 2011 annual impairment testing, the Company identified and recorded a $12 million impairment of goodwill to “General and administrative” in the statement of operations related to the Distribution reporting unit. The impairment was due to declines in our expected future performance of the distribution business, which was a reflection of a continuing shift in the distribution of interactive entertainment software from retail distribution channels towards digital distribution and online gaming.

At December 31, 2012 and 2011, the gross goodwill and accumulated impairment losses by reporting unit are as follows:

		Activision		Blizzard		Distribution		Total
Balance at December 31, 2011:
	Goodwill	$	6,933	$	178	$	12	$	7,123
	Accumulated impairment losses		---		---		(12)		(12)
	Total	$	6,933	$	178	$	---	$	7,111
Balance at December 31, 2012:
	Goodwill	$	6,928	$	178	$	---	$	7,106
	Accumulated impairment losses		---		---		---		---
	Total	$	6,928	$	178	$	---	$	7,106