During the nine months ended September 30, 2011, we acquired all of the capital stock of NetWitness Corporation, a privately-held, market-leading provider of network security analysis solutions. This acquisition complements and expands our RSA Information Security segment. Additionally, during the nine months ended September 30, 2011, VMware acquired six companies. The aggregate consideration for these seven acquisitions was $539.8 million which consisted of $536.6 million of cash consideration, net of cash acquired and $3.2 million for the fair value of our stock options granted in exchange for the acquirees' stock options. The consideration paid was allocated to the fair value of the assets acquired and liabilities assumed based on estimated fair values as of the respective acquisition dates. The allocation to goodwill, intangibles and net assets was approximately $375.8 million, $157.1 million and $6.9 million, respectively. The intangible assets are being amortized based upon the pattern in which the economic benefits of the intangible assets are being utilized. The results of these acquisitions have been included in the consolidated financial statements from the date of purchase. Pro forma results of operations have not been presented as the results of the acquired companies were not material, individually or in the aggregate, to our consolidated results of operations for the three or nine months ended September 30, 2011 or 2010.

Intangible assets, excluding goodwill, as of September 30, 2011 and December 31, 2010 consist of (tables in thousands):

	September 30, 2011
	Gross Carrying		Accumulated
	Amount		Amortization		Net Book Value
Purchased technology	$	1,620,912	$	(982,625)	$	638,287
Patents		224,865		(68,367)		156,498
Software licenses		88,993		(81,461)		7,532
Trademarks and tradenames		172,851		(88,916)		83,935
Customer relationships and customer lists		1,329,774		(560,646)		769,128
In-process research and development		43,900		-		43,900
Leasehold interest		151,083		(1,442)		149,641
Other		25,822		(22,776)		3,046
Total intangible assets, excluding goodwill	$	3,658,200	$	(1,806,233)	$	1,851,967

In the quarter ended June 30, 2011, we, along with three other technology companies, acquired specific patents from Novell, Inc. The purchase price for the patent portfolio was $450.0 million, of which we paid $112.5 million. We assigned the patent portfolio an average life of 10 years, based on average contractual term remaining on the patents we acquired. The cash outflow was included in strategic and other related investments in the investing activities section of the Consolidated Statements of Cash Flows.

In the quarter ended June 30, 2011, VMware closed an agreement to purchase all of the right, title and interest in a ground lease covering the property and improvements located on property adjacent to VMware's Palo Alto, California campus for $225.0 million. Based upon the respective fair values and preliminary assumptions, $51.9 million of the purchase price was recorded to property, plant and equipment, net on the June 30, 2011 Consolidated Balance Sheet, representing the estimated fair value of the buildings and site improvements. The remaining $173.1 million of the purchase price was recorded to intangible assets, net on the June 30, 2011 Consolidated Balance Sheet, for the fair value of the ground lease and the right to develop additional square footage on the parcel.

In the three months ended September 30, 2011, the gross amount classified to property, plant and equipment, net was increased by $22.0 million to $73.9 million to reflect the final assumptions regarding VMware's intended use of the existing structures. As a result of this adjustment, the gross amount of the value attributed to the leasehold interest was decreased by the same amount. These adjustments are reflected on the Consolidated Statements of Cash Flows for the nine months ended September 30, 2011 and the Consolidated Balance Sheets as of September 30, 2011. Concurrent with the closing of the transaction, VMware entered into an amended and restated ground lease for the related property. The buildings and site improvements will be depreciated from the date they are placed into service through the term of the amended and restated ground lease, and intangible assets will amortize through 2046.

	December 31, 2010
	Gross Carrying		Accumulated
	Amount		Amortization		Net Book Value
Purchased technology	$	1,509,616	$	(873,095)	$	636,521
Patents		62,170		(62,134)		36
Software licenses		84,583		(72,115)		12,468
Trademarks and tradenames		171,651		(74,725)		96,926
Customer relationships and customer lists		1,275,908		(447,411)		828,497
In-process research and development		43,900		-		43,900
Other		25,632		(19,713)		5,919
Total intangible assets, excluding goodwill	$	3,173,460	$	(1,549,193)	$	1,624,267

Changes in the carrying amount of goodwill, net, for the nine months ended September 30, 2011 and the year ended December 31, 2010 consist of (tables in thousands):

	Nine Months Ended September 30, 2011
	Information Storage		Information Intelligence Group		RSA Information Security		VMware Virtual Infrastructure		Total


Balance, beginning of the period	$	7,029,341	$	1,467,903	$	1,663,213	$	1,612,193	$	11,772,650
Goodwill resulting from acquisitions		0		0		187,445		188,395		375,840
Tax deduction from exercise of stock options		(73)		0		(95)		0		(168)
Finalization of purchase price allocations		4,038		0		(1,982)		3,273		5,329
Balance, end of the period	$	7,033,306	$	1,467,903	$	1,848,581	$	1,803,861	$	12,153,651

	Year Ended December 31, 2010
	Information Storage		Information Intelligence Group		RSA Information Security		VMware Virtual Infrastructure		Total


Balance, beginning of the year	$	5,045,086	$	1,476,520	$	1,529,408	$	1,159,362	$	9,210,376
Goodwill resulting from acquisitions		2,287,712		0		140,013		178,201		2,605,926
Tax deduction from exercise of stock options		(548)		(2,424)		(1,103)		0		(4,075)
Other adjustments		(275,405)		0		0		275,405		0
Finalization of purchase price allocations		(27,504)		(6,193)		(5,105)		(775)		(39,577)
Balance, end of the year	$	7,029,341	$	1,467,903	$	1,663,213	$	1,612,193	$	11,772,650

Other adjustments to goodwill in the year ended December 31, 2010 include the transfer of the goodwill related to the Ionix information technology management business from the Information Storage segment to the VMware Virtual Infrastructure segment. The goodwill transfer related to the common control acquisition of certain software product technology and related capabilities of our Ionix business by VMware. See Note 15 for additional details.