Revenue Recognition

3 Months Ended

Mar. 31, 2020

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

NOTE 5. REVENUE RECOGNITION

Revenue Categories

The following tables set forth reported revenue by category and by business unit:

For the three months ended March 31, 2020
	Service Revenues
		Wireless		Advanced Data		Legacy Voice & Data		Subscription		Content		Advertising		Other		Equipment		Total
Communications
Mobility	$	13,892	$	-	$	-	$	-	$	-	$	76	$	-	$	3,434	$	17,402
Entertainment Group		-		2,109		581		6,982		-		413		419		11		10,515
Business Wireline		-		3,275		2,129		-		-		-		753		175		6,332
WarnerMedia
Turner		-		-		-		2,049		86		957		70		-		3,162
Home Box Office		-		-		-		1,338		157		-		2		-		1,497
Warner Bros.		-		-		-		10		3,060		2		168		-		3,240
Eliminations and Other		-		-		-		63		(646)		20		23		-		(540)
Latin America
Vrio		-		-		-		887		-		-		-		-		887
Mexico		467		-		-		-		-		-		-		236		703
Xandr		-		-		-		-		-		489		-		-		489
Corporate and Other		117		14		134		-		-		-		83		40		388
Eliminations and
consolidations		-		-		-		-		(794)		(413)		(89)		-		(1,296)
Total Operating Revenues	$	14,476	$	5,398	$	2,844	$	11,329	$	1,863	$	1,544	$	1,429	$	3,896	$	42,779

For the three months ended March 31, 2019
	Service Revenues
		Wireless		Advanced Data		Legacy Voice & Data		Subscription		Content		Advertising		Other		Equipment		Total
Communications
Mobility	$	13,562	$	-	$	-	$	-	$	-	$	67	$	-	$	3,734	$	17,363
Entertainment Group		-		2,070		683		7,724		-		350		501		-		11,328
Business Wireline		-		3,172		2,397		-		-		-		750		159		6,478
WarnerMedia
Turner		-		-		-		1,965		135		1,261		82		-		3,443
Home Box Office		-		-		-		1,334		173		-		3		-		1,510
Warner Bros.		-		-		-		21		3,332		10		155		-		3,518
Eliminations and Other		-		-		-		49		(152)		8		3		-		(92)
Latin America
Vrio		-		-		-		1,067		-		-		-		-		1,067
Mexico		442		-		-		-		-		-		-		209		651
Xandr		-		-		-		-		-		426		-		-		426
Corporate and Other		163		13		7		-		-		-		167		41		391
Eliminations and
consolidations		-		-		-		-		(837)		(350)		(69)		-		(1,256)
Total Operating Revenues	$	14,167	$	5,255	$	3,087	$	12,160	$	2,651	$	1,772	$	1,592	$	4,143	$	44,827

Deferred Customer Contract Acquisition and Fulfillment Costs

Costs to acquire and fulfill customer contracts, including commissions on service activations, for our wireless, business wireline and video entertainment services, are deferred and amortized over the contract period or expected customer relationship life, which typically ranges from three years to five years. For contracts with an estimated amortization period of less than one year, we expense incremental costs immediately.

The following table presents the deferred customer contract acquisition costs and deferred customer contract fulfillment costs included on our consolidated balance sheets:

		March 31,		December 31,
Consolidated Balance Sheets		2020		2019
Deferred Acquisition Costs
Other current assets	$	2,592	$	2,462
Other Assets		2,997		2,991
Total deferred customer contract acquisition costs		5,589		5,453
Deferred Fulfillment Costs
Other current assets		4,438		4,519
Other Assets		6,279		6,439
Total deferred customer contract fulfillment costs	$	10,717	$	10,958

The following table presents deferred customer contract acquisition cost and deferred customer contract fulfillment cost amortization included in “Other cost of revenue” for the three months ended:

		March 31,		March 31,
Consolidated Statements of Income		2020		2019
Deferred acquisition cost amortization	$	636	$	547
Deferred fulfillment cost amortization		1,305		1,098

Contract Assets and Liabilities

A contract asset is recorded when revenue is recognized in advance of our right to bill and receive consideration. The contract asset will decrease as services are provided and billed. For example, when installment sales include promotional discounts (e.g., “buy one get one free”) the difference between revenue recognized and consideration received is recorded as a contract asset to be amortized over the contract term.

When consideration is received in advance of the delivery of goods or services, a contract liability is recorded for deferred revenue. Reductions in the contract liability will be recorded as we satisfy the performance obligations.

The following table presents contract assets and liabilities on our consolidated balance sheets:

		March 31,		December 31,
		2020		2019
Contract asset	$	2,598	$	2,472
Contract liability		6,757		6,999

Our beginning of period contract liability recorded as customer contract revenue during 2020 was $4,519.

Our consolidated balance sheets at March 31, 2020 and December 31, 2019 included approximately $1,700 and $1,611, respectively, for the current portion of our contract asset in “Other current assets” and $5,769 and $5,939, respectively, for the current portion of our contract liability in “Advanced billings and customer deposits.”

Remaining Performance Obligations

Remaining performance obligations represent services we are required to provide to customers under bundled or discounted arrangements, which are satisfied as services are provided over the contract term. In determining the transaction price allocated, we do not include non-recurring charges and estimates for usage, nor do we consider arrangements with an original expected duration of less than one year, which are primarily prepaid wireless, video and residential internet agreements.

Remaining performance obligations associated with business contracts reflect recurring charges billed, adjusted to reflect estimates for sales incentives and revenue adjustments. Performance obligations associated with wireless contracts are estimated using a portfolio approach in which we review all relevant promotional activities, calculating the remaining performance obligation using the average service component for the portfolio and the average device price. As of March 31, 2020, the aggregate amount of the transaction price allocated to remaining performance obligations was $36,486, of which we expect to recognize approximately 86% by the end of 2021, with the balance recognized thereafter.