5.	Goodwill and Intangible Assets

The changes in the carry amounts of goodwill for the years ended December 31, 2012 and 2013 are due to the addition of goodwill resulting from the Xively and Bold acquisitions and the impact of foreign currency translation adjustments related to asset balances that are recorded in non-U.S. currencies.

Changes in goodwill for the years ended December 31, 2012 and 2013, are as follows (in thousands):

 

Balance, December 31, 2011		$	7,259
Goodwill related to the acquisition of Bold			11,178
Foreign currency translation adjustments			446
Balance, December 31, 2012		$	18,883
Foreign currency translation adjustments			(171	)
Balance, December 31, 2013		$	18,712

 

Intangible assets consist of the following (in thousands):

 

						December 31, 2012												December 31, 2013
		Estimated Useful Life				Gross Carrying Amount				Accumulated Amortization				Net Carrying Amount				Gross Carrying Amount				Accumulated Amortization				Net Carrying Amount
Identifiable intangible assets:
Trademark			1-5 years			$	666			$	666			$	—			$	666			$	666			$	—
Customer base			5-7 years				3,789				1,447				2,342				3,789				1,901				1,888
Domain names			5 years				534				137				397				894				341				553
Software			4 years				299				299				—				299				299				—
Technology			3-6 years				2,463				1,581				882				13,963				1,835				12,128
Technology and know-how			3-6 years				3,257				1,577				1,680				3,176				2,597				579
Non-Compete agreements			5 years				162				9				153				162				34				128
Internally developed software			3 years				1,282				368				914				2,485				875				1,610
						$	12,452			$	6,084			$	6,368			$	25,434			$	8,548			$	16,886

In 2012, as a result of the Bold acquisition, the Company capitalized $1.1 million of technology, $30,000 of trade names and trademarks, $2.8 million of customer base and $160,000 of non-compete agreements as intangible assets. Changes in the gross carrying amount of the intangible assets are due to foreign currency translation adjustments. The Company is amortizing the intangible assets based upon the pattern in which their economic benefit will be realized, or if this pattern cannot be reliably determined, using the straight-line method over their estimated useful lives. The intangible assets have estimated useful lives which range from one to seven years.

On November 6, 2013, the Company purchased a software asset for $11.5 million. This software asset is recorded as an Intangible asset and classified as Technology and will be amortized using the straight-line method over an estimated useful life of five years, beginning when the product is made available to customers in the first quarter of 2014.

The Company capitalized costs related to internally developed computer software to be sold as a service incurred during the application development stage of $742,000 and $1.2 million during 2012 and 2013, respectively, and is amortizing these costs over the expected lives of the related services. The Company paid $311,000 and $358,000 during 2012 and 2013, respectively, to acquire domain names.

The Company is amortizing the intangible assets over the estimated useful lives noted above. Amortization expense for intangible assets was $794,000, $2.1 million and $2.5 million for the years ended December 31, 2011, 2012 and 2013, respectively. Amortization relating to software, technology and know-how and internally developed software is recorded within cost of revenues and the amortization of trademark, customer base, and domain names is recorded within operating expenses. Future estimated amortization expense for intangible assets is as follows at December 31, 2013 (in thousands):

 

Amortization Expense (Years Ending December 31)		Amount
2014			4,333
2015			3,706
2016			3,257
2017			2,787
2018			2,612
Thereafter			191
Total		$	16,886