Goodwill and Intangible Assets

3 Months Ended

Mar. 31, 2012

Goodwill and Intangible Assets [Abstract]

9. Goodwill and Intangible Assets

The Company has intangible assets primarily relating to the acquisitions of its Jinan Broadband subsidiary, Shandong Media joint venture and Sinotop Hong Kong. The Company amortizes its intangible assets that have finite lives. As discussed in Note 4, the Company determined during 2011 that AdNet's remaining assets would no longer be used. As such, the Company recognized an impairment loss related to AdNet's software technology in the amount of $189,241 during the quarter ended June 30, 2011.

A roll forward of our intangible assets activity for the three months ended March 31, 2012 is as follows:

	Balance at									Foreign		Balance at
	December 31,				Amortization			Impairment		Currency		March 31,
	2011		Additions		Expense			Charge		Transl Adj		2012
												(unaudited)
Amortized intangible assets:
Service agreement	$	1,310,892	$	-	$	(21,490	)	$	-	$	-	$	1,289,402
Publication rights		400,953		-		(6,075	)		-		-		394,878
Customer relationships		76,579		-		(2,945	)		-		-		73,634
Operating permits		600,147		-		(9,093	)		-		-		591,054
Charter / Cooperation agreements		2,560,616		-		(34,448	)		-		-		2,526,168
Noncompete agreement		1,576,256		-		(363,751	)		-		-		1,212,505
Software and licenses		240,015		3,456		(19,676	)		-		331		224,126
Website development		250,000		100,000		(29,212	)		-		45		320,833
Total amortized intangible assets	$	7,015,458	$	103,456	$	(486,690	)	$	-	$	376	$	6,632,600

Unamortized intangible assets:
Website name		134,290											134,290
Goodwill		6,105,478		-		-			-		-		6,105,478
Total unamortized intangible assets	$	6,239,768	$	-	$	-		$	-	$	-	$	6,239,768

In accordance with ASC 250, we recorded amortization expense related to our intangible assets of $486,690 and $501,073 for the three months ended March 31, 2011 and 2012.

The following table outlines the amortization expense for the next five years and thereafter:

	Jinan		Shandong		Sinotop
Years ending December 31,	Broadband		Media		Hong Kong		Sinotop		Total
2012 (nine months)	$	64,470	$	56,841	$	1,194,597	$	160,708	$	1,476,616
2013		85,961		74,955		259,041		178,630		598,587
2014		85,961		72,454		137,791		155,764		451,970
2015		85,961		72,454		137,791		28,326		324,532
2016		85,961		72,454		137,791		16,524		312,730
Thereafter		881,095		715,408		1,871,662		-		3,468,165
Total amortization to be recognized	$	1,289,409	$	1,064,566	$	3,738,673	$	539,952	$	6,632,600

- 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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