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Note 5. Franchising and Marketing Activities Franchising and Marketing Activities (Notes) | 12 Months Ended
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Dec. 31, 2016
Franchising and Marketing Activities [Abstract] |
Franchisors [Text Block] | FRANCHISING AND MARKETING ACTIVITIES Franchise fee revenue includes domestic initial franchise fees and international area development fees of $8 million, $8 million, and $9 million for the years ended December 31, 2016, 2015 and 2014, respectively. In addition, franchise fee revenue is net of annual volume incentives provided to real estate franchisees of $56 million, $51 million and $50 million for the years ended December 31, 2016, 2015 and 2014, respectively. The Company’s real estate franchisees may receive volume incentives on their royalty payments. Such annual incentives are based upon the amount of the franchisees commission income earned and paid to the Company during the calendar year. Each brand has several different annual incentive schedules currently in effect. The Company’s wholly owned real estate brokerage services segment, NRT, pays royalties to the Company’s franchise business; however, such amounts are eliminated in consolidation. NRT paid royalties to the Real Estate Franchise Services segment of $282 million, $284 million and $269 million for the years ended December 31, 2016, 2015 and 2014, respectively. Marketing fees are generally paid by the Company’s real estate franchisees and are generally calculated based on a specified percentage of gross closed commissions earned on real estate transactions, and may be subject to certain minimum and maximum payments. NRT paid marketing fees to the Real Estate Franchise Services segment of $11 million, $11 million and $14 million for the years ended December 31, 2016, 2015 and 2014, respectively. As provided for in the franchise agreements and generally at the Company’s discretion, all of these fees are to be expended for marketing purposes. The number of franchised and company owned offices in operation are as follows:
| (Unaudited) As of December 31,
| 2016 |  | 2015 |  | 2014
Franchised: |  |  |  |  |
Century 21® | 7,330 |  |  | 6,897 |  |  | 6,902 |
ERA® | 2,347 |  |  | 2,355 |  |  | 2,304 |
Coldwell Banker® | 2,289 |  |  | 2,258 |  |  | 2,396 |
Coldwell Banker Commercial® | 180 |  |  | 163 |  |  | 167 |
Sotheby’s International Realty® | 836 |  |  | 794 |  |  | 717 |
Better Homes and Gardens® Real Estate | 332 |  |  | 304 |  |  | 283 |
Total Franchised | 13,314 |  |  | 12,771 |  |  | 12,769 |
Company Owned: |  |  |  |  |
ERA® | — |  |  | — |  |  | — |
Coldwell Banker® | 708 |  |  | 708 |  |  | 651 |
Sotheby’s International Realty® | 41 |  |  | 41 |  |  | 39 |
Corcoran®/Other | 40 |  |  | 38 |  |  | 37 |
Total Company Owned | 789 |  |  | 787 |  |  | 727 |
The number of franchised and company owned offices (in the aggregate) changed as follows:
| (Unaudited) For the Year Ended December 31,
| 2016 |  | 2015 |  | 2014
Franchised: |  |  |  |  |
Beginning balance | 12,771 |  |  | 12,769 |  |  | 13,032 |
Additions | 847 |  |  | 445 |  |  | 311 |
Terminations | (304 | ) |  | (443 | ) |  | (574 | )
Ending balance | 13,314 |  |  | 12,771 |  |  | 12,769 |
Company Owned: |  |  |  |  |
Beginning balance | 787 |  |  | 727 |  |  | 706 |
Additions | 38 |  |  | 74 |  |  | 38 |
Closures | (36 | ) |  | (14 | ) |  | (17 | )
Ending balance | 789 |  |  | 787 |  |  | 727 |
As of December 31, 2016, there were an insignificant number of franchise agreements that were executed for which offices are not yet operating. Additionally, as of December 31, 2016, there were an insignificant number of franchise agreements pending termination. In order to assist franchisees in converting to one of the Company’s brands, expand their operations or as an incentive to renew their franchise agreement, the Company may at its discretion, provide non-standard incentives, primarily in the form of conversion notes (prior to 2009, the Company issued development advance notes). Provided the franchisee meets certain minimum annual revenue thresholds during the term of the notes and is in compliance with the terms of the franchise agreement, the amount of the note is forgiven annually in equal ratable amounts over the life of the franchise agreement. Otherwise, related principal is due and payable to the Company. The amount of such franchisee conversion notes and development advance notes were $123 million, net of less than $1 million of reserves, and $115 million, net of $1 million of reserves, at December 31, 2016 and 2015, respectively. These notes are principally classified within other non-current assets in the Company’s Consolidated Balance Sheets. The Company recorded a charge in the statement of operations related to the forgiveness and impairment of these notes of $19 million, $17 million and $15 million for the years ended December 31, 2016, 2015 and 2014, respectively.

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- Definition The entire disclosure for franchisors. + References No definition available. + Details
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