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Intangible Assets and Goodwill, Net | 12 Months Ended
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Dec. 31, 2019
Intangible Assets and Goodwill, Net |
Intangible Assets and Goodwill, Net | 13.Intangible Assets and Goodwill, Net As of December 31, 2019 and 2018, intangible assets and goodwill are summarized as follows:
|  | 2019 |  | 2018
|  |  |  |  | Accumulated |  |  |  |  |  |  |  | Accumulated |  |  |
|  | Cost |  | Amortization |  | Carrying Value |  | Cost |  | Amortization |  | Carrying Value
Intangible assets and goodwill with indefinite useful lives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Trademarks |  | Ps. | 175,444 |  | Ps. | — |  | Ps. | 175,444 |  | Ps. | 479,409 |  | Ps. | — |  | Ps. | 479,409
Concessions |  |  | 15,166,067 |  |  | — |  |  | 15,166,067 |  |  | 15,166,067 |  |  | — |  |  | 15,166,067
Goodwill |  |  | 14,113,626 |  |  | — |  |  | 14,113,626 |  |  | 14,113,626 |  |  | — |  |  | 14,113,626
|  |  | 29,455,137 |  |  | — |  |  | 29,455,137 |  |  | 29,759,102 |  |  | — |  |  | 29,759,102
Intangible assets with finite useful lives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Trademarks |  |  | 2,127,697 |  |  | (1,899,187) |  |  | 228,510 |  |  | 1,891,306 |  |  | (1,569,786) |  |  | 321,520
Concessions |  |  | 553,505 |  |  | (332,103) |  |  | 221,402 |  |  | 553,505 |  |  | (221,402) |  |  | 332,103
Licenses |  |  | 10,858,388 |  |  | (6,843,169) |  |  | 4,015,219 |  |  | 9,065,582 |  |  | (5,934,647) |  |  | 3,130,935
Subscriber lists |  |  | 8,782,852 |  |  | (6,632,419) |  |  | 2,150,433 |  |  | 8,785,423 |  |  | (6,108,251) |  |  | 2,677,172
Payments for renewal of concessions |  |  | 5,821,828 |  |  | — |  |  | 5,821,828 |  |  | 5,993,891 |  |  | (15,454) |  |  | 5,978,437
Other intangible assets |  |  | 5,198,960 |  |  | (3,762,535) |  |  | 1,436,425 |  |  | 4,099,750 |  |  | (3,235,503) |  |  | 864,247
|  |  | 33,343,230 |  |  | (19,469,413) |  |  | 13,873,817 |  |  | 30,389,457 |  |  | (17,085,043) |  |  | 13,304,414
|  | Ps. | 62,798,367 |  | Ps. | (19,469,413) |  | Ps. | 43,328,954 |  | Ps. | 60,148,559 |  | Ps. | (17,085,043) |  | Ps. | 43,063,516
Changes in intangible assets and goodwill with indefinite useful lives in 2019 and 2018, were as follows:
|  | 2019
|  | Trademarks |  | Concessions |  | Goodwill |  | Total
Cost: |  |  |  |  |  |  |  |  |  |  |  |
Balance at beginning of period |  | Ps. | 479,409 |  | Ps. | 15,166,067 |  | Ps. | 14,113,626 |  | Ps. | 29,759,102
Impairment adjustments |  |  | (67,574) |  |  | — |  |  | — |  |  | (67,574)
Transfers and reclassifications |  |  | (236,391) |  |  | — |  |  | — |  |  | (236,391)
Balance at end of period |  | Ps. | 175,444 |  | Ps. | 15,166,067 |  | Ps. | 14,113,626 |  | Ps. | 29,455,137
|  | 2018
|  | Trademarks |  | Concessions |  | Goodwill |  | Total
Cost: |  |  |  |  |  |  |  |  |  |  |  |
Balance at beginning of period |  | Ps. | 615,147 |  | Ps. | 15,166,067 |  | Ps. | 14,112,626 |  | Ps. | 29,893,840
Additions |  |  | — |  |  | — |  |  | 1,000 |  |  | 1,000
Impairment adjustments |  |  | (135,750) |  |  | — |  |  | — |  |  | (135,750)
Effect of translation |  |  | 12 |  |  | — |  |  | — |  |  | 12
Balance at end of period |  | Ps. | 479,409 |  | Ps. | 15,166,067 |  | Ps. | 14,113,626 |  | Ps. | 29,759,102
Changes in intangible assets with finite useful lives in 2019 and 2018, were as follows:
|  | 2019
|  |  |  |  |  |  |  |  |  |  |  |  |  | Payments for |  | Other |  |  |
|  |  |  |  |  |  |  |  |  |  | Subscriber |  | Renewal of |  | Intangible |  |  |
|  | Trademarks |  | Concessions |  | Licenses |  | Lists |  | Concessions |  | Assets |  | Total
Cost: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance at beginning of period |  | Ps. | 1,891,306 |  | Ps. | 553,505 |  | Ps. | 9,065,582 |  | Ps. | 8,785,423 |  | Ps. | 5,993,891 |  | Ps. | 4,099,750 |  | Ps. | 30,389,457
Additions |  |  | — |  |  | — |  |  | 913,108 |  |  | — |  |  | 67,285 |  |  | 1,126,357 |  |  | 2,106,750
Transfers from property, plant and equipment |  |  | — |  |  | — |  |  | 1,487,056 |  |  | — |  |  | — |  |  | — |  |  | 1,487,056
Retirements |  |  | — |  |  | — |  |  | (526,166) |  |  | — |  |  | (239,348) |  |  | (90,324) |  |  | (855,838)
Transfers and reclassifications |  |  | 236,391 |  |  | — |  |  | (68,641) |  |  | 1,162 |  |  | — |  |  | 67,479 |  |  | 236,391
Effect of translation |  |  | — |  |  | — |  |  | (12,551) |  |  | (3,733) |  |  | — |  |  | (4,302) |  |  | (20,586)
Balance at end of period |  |  | 2,127,697 |  |  | 553,505 |  |  | 10,858,388 |  |  | 8,782,852 |  |  | 5,821,828 |  |  | 5,198,960 |  |  | 33,343,230
Amortization: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance at beginning of period |  |  | (1,569,786) |  |  | (221,402) |  |  | (5,934,647) |  |  | (6,108,251) |  |  | (15,454) |  |  | (3,235,503) |  |  | (17,085,043)
Amortization of the year |  |  | (329,401) |  |  | (110,701) |  |  | (1,490,841) |  |  | (530,013) |  |  | (7,773) |  |  | (31,917) |  |  | (2,500,646)
Other amortization of the year (1) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (531,426) |  |  | (531,426)
Retirements |  |  | — |  |  | — |  |  | 529,403 |  |  | — |  |  | 23,227 |  |  | 79,108 |  |  | 631,738
Reclassifications |  |  | — |  |  | — |  |  | 44,824 |  |  | 2,112 |  |  | — |  |  | (46,936) |  |  | —
Effect of translation |  |  | — |  |  | — |  |  | 8,092 |  |  | 3,733 |  |  | — |  |  | 4,139 |  |  | 15,964
Balance at end of period |  |  | (1,899,187) |  |  | (332,103) |  |  | (6,843,169) |  |  | (6,632,419) |  |  | — |  |  | (3,762,535) |  |  | (19,469,413)
|  | Ps. | 228,510 |  | Ps. | 221,402 |  | Ps. | 4,015,219 |  | Ps. | 2,150,433 |  | Ps. | 5,821,828 |  | Ps. | 1,436,425 |  | Ps. | 13,873,817
|  | 2018
|  |  |  |  |  |  |  |  |  |  |  |  |  | Payments for |  | Other |  |  |
|  |  |  |  |  |  |  |  |  |  | Subscriber |  | Renewal of |  | Intangible |  |  |
|  | Trademarks |  | Concessions |  | Licenses |  | Lists |  | Concessions |  | Assets |  | Total
Cost: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance at beginning of period |  | Ps. | 1,891,306 |  | Ps. | 553,505 |  | Ps. | 7,470,669 |  | Ps. | 6,203,875 |  | Ps. | 244,692 |  | Ps. | 3,696,000 |  | Ps. | 20,060,047
Additions |  |  | — |  |  | — |  |  | 895,187 |  |  | — |  |  | 5,754,543 |  |  | 428,448 |  |  | 7,078,178
Transfers from property, plant and equipment |  |  | — |  |  | — |  |  | 702,562 |  |  | — |  |  | — |  |  | — |  |  | 702,562
Acquisition of Axtel |  |  | — |  |  | — |  |  | — |  |  | 2,581,713 |  |  | — |  |  | — |  |  | 2,581,713
Retirements |  |  | — |  |  | — |  |  | (2,625) |  |  | — |  |  | (5,344) |  |  | (24,563) |  |  | (32,532)
Effect of translation |  |  | — |  |  | — |  |  | (211) |  |  | (165) |  |  | — |  |  | (135) |  |  | (511)
Balance at end of period |  |  | 1,891,306 |  |  | 553,505 |  |  | 9,065,582 |  |  | 8,785,423 |  |  | 5,993,891 |  |  | 4,099,750 |  |  | 30,389,457
Amortization: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance at beginning of period |  |  | (1,096,959) |  |  | (110,701) |  |  | (4,672,961) |  |  | (5,404,722) |  |  | (7,703) |  |  | (2,774,407) |  |  | (14,067,453)
Amortization of the year |  |  | (472,827) |  |  | (110,701) |  |  | (1,264,172) |  |  | (703,694) |  |  | (8,140) |  |  | (40,125) |  |  | (2,599,659)
Other amortization of the year (1) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (444,679) |  |  | (444,679)
Retirements |  |  | — |  |  | — |  |  | 2,320 |  |  | — |  |  | 389 |  |  | 23,365 |  |  | 26,074
Effect of translation |  |  | — |  |  | — |  |  | 166 |  |  | 165 |  |  | — |  |  | 343 |  |  | 674
Balance at end of period |  |  | (1,569,786) |  |  | (221,402) |  |  | (5,934,647) |  |  | (6,108,251) |  |  | (15,454) |  |  | (3,235,503) |  |  | (17,085,043)
|  | Ps. | 321,520 |  | Ps. | 332,103 |  | Ps. | 3,130,935 |  | Ps. | 2,677,172 |  | Ps. | 5,978,437 |  | Ps. | 864,247 |  | Ps. | 13,304,414
| (1) |  | Other amortization of the year relates primarily to amortization of soccer player rights, which is included in consolidated cost of sales.
All of the amortization charges are presented in Note 21. The changes in the net carrying amount of goodwill, indefinite-lived trademarks and concessions for the year ended December 31, 2019 and 2018, were as follows:
|  |  |  |  |  |  |  |  |  |  | Foreign |  |  |  |  |  |  |  |  |
|  | Balance as of |  |  |  |  |  |  |  | Currency |  |  |  |  |  |  |  | Balance as of
|  | January 1, |  |  |  |  |  |  |  | Translation |  | Impairment |  |  |  |  | December 31,
|  | 2019 |  | Acquisitions |  | Retirements |  | Adjustments |  | Adjustments |  | Transfers |  | 2019
Goodwill: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cable |  | Ps. | 13,794,684 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | 13,794,684
Content |  |  | 241,973 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 241,973
Other Businesses |  |  | 76,969 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 76,969
|  | Ps. | 14,113,626 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | 14,113,626
Indefinite-lived trademarks (see Note 3): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cable |  | Ps. | 368,603 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | (236,391) |  | Ps. | 132,212
Other Businesses |  |  | 110,806 |  |  | — |  |  | — |  |  | — |  |  | (67,574) |  |  | — |  |  | 43,232
|  | Ps. | 479,409 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | (67,574) |  | Ps. | (236,391) |  | Ps. | 175,444
Indefinite-lived concessions (see Note 3): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cable |  | Ps. | 15,070,025 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | 15,070,025
Sky |  |  | 96,042 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 96,042
|  | Ps. | 15,166,067 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | 15,166,067
|  |  |  |  |  |  |  |  |  |  | Foreign |  |  |  |  |  |  |  |  |
|  | Balance as of |  |  |  |  |  |  |  | Currency |  |  |  |  |  |  |  | Balance as of
|  | January 1, |  |  |  |  |  |  |  | Translation |  | Impairment |  |  |  |  | December 31,
|  | 2018 |  | Acquisitions |  | Retirements |  | Adjustments |  | Adjustments |  | Transfers |  | 2018
Goodwill: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cable |  | Ps. | 13,793,684 |  | Ps. | 1,000 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | 13,794,684
Content |  |  | 241,973 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 241,973
Other Businesses |  |  | 76,969 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 76,969
|  | Ps. | 14,112,626 |  | Ps. | 1,000 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | 14,113,626
Indefinite-lived trademarks (see Note 3): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cable |  | Ps. | 368,603 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | 368,603
Other Businesses |  |  | 246,544 |  |  | — |  |  | — |  |  | 12 |  |  | (135,750) |  |  | — |  |  | 110,806
|  | Ps. | 615,147 |  | Ps. | — |  | Ps. | — |  | Ps. | 12 |  | Ps. | (135,750) |  | Ps. | — |  | Ps. | 479,409
Indefinite-lived concessions (see Note 3): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cable |  | Ps. | 15,070,025 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | 15,070,025
Sky |  |  | 96,042 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 96,042
|  | Ps. | 15,166,067 |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | — |  | Ps. | 15,166,067
During the second half of 2019 and 2018, the Group monitored the market associated with its Publishing business, which is classified into the Other Businesses segment, which has experienced a general slow-down in Latin America. Accordingly, the Group reduced its cash flow expectations for some of its foreign operations. As a result, the Group compared the fair value of the intangible assets in the reporting units with the related carrying value and recorded an aggregate impairment charge in connection with trademarks of Ps.67,574 and Ps.135,750, in other expense, net, in the consolidated statements of income for the years ended December 31, 2019 and 2018, respectively. The key assumptions used for fair value calculations of goodwill and intangible assets in 2019, were as follows (see Note 15):
|  | Cable |  | Other Businesses |
|  | Minimum |  | Maximum |  | Minimum |  | Maximum |
Long-term growth rate |  | 3.50 | % | 3.50 | % | 3.50 | % | 3.50 | %
Discount rate |  | 10.90 | % | 11.20 | % | 14.60 | % | 15.60 | %
The key assumptions used for fair value calculations of goodwill and intangible assets in 2018, were as follows (see Note 15):
|  | Cable |  | Other Businesses |
|  | Minimum |  | Maximum |  | Minimum |  | Maximum |
Long-term growth rate |  | 3.50 | % | 3.50 | % | 1.00 | % | 5.90 | %
Discount rate |  | 11.00 | % | 11.50 | % | 14.30 | % | 14.60 | %
Management has identified that a reasonably possible change in the key assumptions identified above could cause the carrying amount to exceed in 2019, the recoverable amount of one of the five CGUs with indefinite-life intangible assets tested for impairment. The change required for the carrying amount to equal the recoverable amount is a 3.6% increase in the discount rate (equivalent to a 36 basis point change) or a 14.0% decrease in the long term growth rate (equivalent to a 50 basis point change). As described in Note 2 (l), in 2015, the Company’s management estimated the remaining useful life of four years for acquired trademarks in specific locations of Mexico, in connection with the migration to an internally developed trademark in the Group’s Cable segment. Amortization of trademarks with a finite useful life amounted to Ps.321,520 and Ps.472,827 , for each of the years ended December 31, 2019 and 2018, respectively. In the fourth quarter of 2017, the Company’s management reviewed the useful life of certain Group’s television concessions accounted for as intangible assets in conjunction with the payment made in 2018 for renewal of concessions expiring in 2021, which amount was determined by the IFT before the renewal date (see Note 2 (b)). Based on such review, the Group classified these concessions as intangible assets with a finite useful life and began to amortize the related net carrying amount of Ps.553,505 in a period ending in 2021. Amortization of these concessions with a finite useful life amounted to Ps.110,701 for each of the years ended December 31, 2019 and 2018. Assuming a remaining useful life of five years, amortization of these concessions in future years is estimated in the following amounts:
|  | Year ended
|  | December 31,
2020 |  | Ps. | 110,701
2021 |  |  | 110,701

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