Annual report pursuant to Section 13 and 15(d)

INTANGIBLE ASSETS AND GOODWILL

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INTANGIBLE ASSETS AND GOODWILL
 12 Months Ended
Mar. 31, 2014
INTANGIBLE ASSETS AND GOODWILL [Abstract]  
INTANGIBLE ASSETS AND GOODWILL

NOTE 6: INTANGIBLE ASSETS AND GOODWILL

Intangible Assets

Acquired intangible assets are amortized over their estimated useful lives, which generally range from one to eight years. In estimating the useful lives of intangible assets, we considered the following factors:

  • The cash flow projections used to estimate the useful lives of the intangible assets showed a trend of growth that was expected to continue for an extended period of time;
  • Our tape automation products, disk systems and software, in particular, have long development cycles; these products have experienced long product life cycles; and
  • Our ability to leverage core technology into data protection and scale-out storage and archive solutions and, therefore, to extend the lives of these technologies.

Acquired IPR&D is amortized over its estimated useful life once technological feasibility is reached. If IPR&D is determined to not have technological feasibility or is abandoned, we write off the IPR&D in that period.

Following is the weighted average amortization period for our amortizable intangible assets:

    Amortization
(Years)
Purchased technology       6.2
Trademarks   6.0
Customer lists   7.6
       All intangible assets   6.6

Intangible amortization within our Consolidated Statements of Operations for the years ended March 31, 2014, 2013 and 2012 follows (in thousands):

    For the year ended March 31,
    2014   2013   2012
Purchased technology       $ 1,476       $ 3,775       $ 7,583
Trademarks     -     244     700
Non-compete agreements     -     -     32
Customer lists     7,426     9,280     12,428
    $     8,902   $     13,299   $     20,743

The following table provides a summary of the carrying value of intangible assets (in thousands):

    As of March 31,
    2014   2013
    Gross
Amount		   Accumulated
Amortization		   Net
Amount		   Gross
Amount		   Accumulated
Amortization		   Net
Amount
Purchased technology       $ 179,475       $ (178,348 )       $ 1,127       $ 180,613       $ (178,168 )       $ 2,445
Trademarks     3,900     (3,900 )     -     3,900     (3,900 )     -
Customer lists     76,019     (73,235 )     2,784     105,719     (95,509 )     10,210
In-process research and development     -     -       -     158     -       158
    $     259,394   $     (255,483 )   $     3,911   $     290,390   $     (277,577 )   $     12,813

The total expected future amortization related to amortizable intangible assets is provided in the table below (in thousands):

    Amortization
Fiscal 2015       $ 3,628
Fiscal 2016     177
Fiscal 2017     71
Fiscal 2018     35
       Total as of March 31, 2014   $         3,911

We evaluate our amortizable intangible and other long-lived assets for impairment whenever indicators of impairment exist and concluded the carrying amount of our long-lived assets was recoverable and there was no impairment in fiscal 2014, 2013 and 2012. In fiscal 2014 and fiscal 2013, we wrote off $31.0 million and $3.2 million, respectively, of fully amortized intangible assets related to fiscal 2002, 2003, 2006 and 2007 acquisitions. In-process research and development of $0.1 million and $0.2 million reached technological feasibility during fiscal 2014 and fiscal 2013, respectively, was transferred to amortizable purchased technology intangible assets and is being amortized over its estimated useful life.

Goodwill

The following provides a summary of the carrying value of goodwill (in thousands):

    Goodwill   Accumulated
Impairment Losses 		  Net Amount
Balance March 31, 2013 and March 31, 2014       $     394,613       $        (339,000 )       $     55,613

Our annual impairment evaluation for goodwill in the fourth quarters of fiscal 2014, 2013 and 2012 did not indicate any impairment of our goodwill in fiscal 2014, 2013 and 2012.