SecProbe.io

November 23, 2010
 Mr. Stephen J. Thomas Chief Accounting Officer 833 West South Boulder Road
Louisville, Colorado 80027

Re: GAIAM, Inc.  Form 10-K for the year ended December 31, 2009  Filed March 16, 2010
File No. 000-27517
 Dear Mr. Thomas:
 We have reviewed your and have the follo wing comments.  Unless otherwise indicated,
we think you should revise your document in future  filings in response to these comments.  If
you disagree, we will consider your explanation as  to why our comment is inapplicable or a
revision is unnecessary.  Please be as detailed as necessary in your  explanation.  In some of our
comments, we may ask you to provide us with  information so we may better understand your
disclosure.  After reviewing this inform ation, we may raise additional comments.
  Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure requir ements and to enhance the overall disclosure in
your filing.  We look forward to working with you in these respects.  We welcome any questions
you may have about our comments or any other aspect of our review.  Feel fr ee to call us at the
telephone numbers listed at the end of th is letter.

Please respond to confirm that such comments will be complied with, or, if certain of the
comments are deemed inappropriate, advise the staff of your reason.  Your response should be
submitted in electronic form, under the label “corres p” with a copy to the staff.  Please respond
within ten (10) business days.

Form 10-K for the year ended December 31, 2009

 Item 1A. Risk Factors, page 9

1. We note your disclosure in the first paragra ph of this section of “[t]hese risks and
uncertainties include, but are not limited to, t hose risks described below of which we are
presently aware.”  All material risks should be discussed in this section.  In future filings,
please revise this paragraph to clarify that you have discussed all known material risks.  If
a risk is deemed immaterial, please do not reference it.

Mr. Stephen J. Thomas GAIAM, Inc.
November 23, 2010 Page 2

Our founder and chairman Jirka Rysavy controls us, page 11

2. In future filings, please quantify what percen tage of the voting stock that Mr. Rysavy
holds.
 Management’s Discussion and Analysis of Fi nancial Condition and Results of Operations

- Results of Operations, page 20

3. Please revise future filings to discuss and analyze net revenues and cost of goods sold (rather than gross profit) sepa rately for each segment.  Because gross profit is impacted
by both net revenues and cost of goods sold, we believe a separate discussion of cost of
goods sold results is appropriate.
 - Non-GAAP Financial Measures, page 23

4. We note that your disclosures of Non-GAAP fi nancial measures include a reconciliation
of GAAP net loss to Non-GAAP net loss.  In  light of the fact that you present the
adjustments net of tax, please revise future filings to disclose how the tax effect was
calculated.  Also, in light of  your disclosure of Non-GAAP loss per share, please revise
future filings to include disclosure of th e reconciliation of Non-GAAP loss per share to
the GAAP loss per share.  See guidance in Questions 102.11 and 102.5 of the
Compliance and Disclosure Interpretations : Non-GAAP Financial Measures January 11,
2010.

Audited Financial Statements
 Statements of Operations, page 30

5. We note from your disclosures in Note 13 a nd elsewhere in the filing, that the Solar
segment, which includes solar energy integr ation businesses, cont ributes a significant
amount of revenue and contribution margin to  the consolidated entity in 2009.  As it
appears that this segment generates revenue fr om services, rather than from the sale of
products, we believe that your statement of  operations should be revised to present
revenue and cost of goods sold separately fo r both products and services.  Please revise
future filings accordingly.  See Rule 5-03 of Regulation S-X.
 Notes to the Financial Statements

 - General

6. We note from your disclosure on page 11 th at Jirka Rysavy, your founder and Chairman,
holds 100% of your class B common shares and 868,682 Cla ss A common shares.  The
shares of Class B common stock are convertible into shares of Class A common stock at

Mr. Stephen J. Thomas GAIAM, Inc.
November 23, 2010 Page 3

any time and each share of Class B common stock has ten votes per share, while each share of Class A common stock has one vote per share.  As suc h, it appears that he is able
to vote a majority of the stock of the Company and has the e ffective power to control the
vote on substantially all significant matters without the approval of other stockholders.  In future filings, please revise the footnotes to  the financial statements to disclose the
existence of this potential control relations hip with respect to your outstanding common
shares.  Refer to the requirements of ASC 850-10-50-6.
 Note 2. Significant Accounting Policies

 – Goodwill and Other Intangibles, page 35

7. We note your disclosure that in 2008 you r ecorded a $3.7 million reduction to goodwill in
the business segment due to a bus iness disposition.  Please explain to us the nature of the
business disposition and tell us how you acc ounted for the disposition including how you
determined the amount of goodwill that was allo cated to the business that was disposed
of.  As part of your response, please tell us if any gain or loss on the disposition was
recorded in the statement of operations.
 – Revenues, page 36

8. We note your disclosure that you had six a nd two solar energy in tegration contracts
accounted for under the percentage-of-comp letion method as of December 31, 2009 and
2008, respectively.  Please tell us, and revise fu ture filings to disclose the method used
for measuring the extent of progress towards completion (e.g. cost to  cost, labor hours).
See guidance in ASC 605-35-50-2.   Also, pleas e tell us if you have any significant
amounts of costs and recognized in come not yet billed, or bil lings in excess of costs and
recognized income.  See ASC 605-35-45-3.

9. We note from the disclosure included on pa ge 36 that the Company recognizes revenue
from fixed price contracts using either the completed contract or percentage-of-
completion method, based on the energy size of  the solar energy integration project.
Please explain in further detail why the si ze of the solar energy integration project
influences which method of revenue recognition is used. Please note that ASC 605-35-
25-1 provides that the determination of which of  the two methods is pr eferable should be
based on a careful evaluation of the circum stances because the two methods should not
be acceptable alternatives for the same circumstances. Furthermore, as outlined in ASC 605-35-25-57, the percentage-of-completion me thod is considered preferable as an
accounting policy in circumstances in whic h reasonably dependable estimates can be
made, and the following conditions exist:

(a) Contracts executed by the partie s normally include provisions  that clearly specify the
enforceable rights regarding goods or servic es to be provided and received by the
parties, the consideration to be exchange d, and the manner and terms of settlement.

Mr. Stephen J. Thomas GAIAM, Inc.
November 23, 2010 Page 4

(b)The buyer can be expected to satisfy  all obligations und er the contract.
 (c ) The contractor can be expected to perform all contractual obligations.

Your response should explain in  detail why you believe it is not appropriate to  utilize the
percentage of completion method for certain  of your contracts, including why these
contracts do not meet the conditions outlined  above. We may have further comment upon
receipt of your response.
 Note 4. Mergers and Acquisitions, page 38

10. We note your disclosure that during 2009 you issued 25,000 shares of Class A common
stock worth $64,000 and paid $1.5 million as co ntingent consideration for two of your
2007 acquisitions.  Please tell us what this contingent consideration was based on (e.g., earnings, security price) and tell us how you accounted for this payment of contingent consideration.  Also, tell us how you valued the stock issued in this transaction.  If it was based on “fair value”, please tell us how you calculated or determined “fair value.”

11. We note your disclosure that during the f ourth quarter of 2009 you closed one of your
insignificant, unprofitable dire ct to consumer businesse s, resulting in a pre-tax
deconsolidation loss of $1.8 million.  In light of the significance of this loss to the statement of operations in 2009, please explain to us how you calculated or determined the amount of the loss recognized.
 Note 11. Equity, page 43

12. We note your disclosure that during 2 009 and 2008 you issued shares of Class A
common stock to your independent  directors for services re ndered and in 2009 you issued
Class A common stock shares for consulting serv ices.  Please tell us and explain in the
notes to your financial statements how you valu ed the shares issued and/or the related
consideration received in each of these transa ctions. If the transactions were recorded
based on the fair value of the shares issu ed, please explain how “fair value” was
determined.
 Form 10-Q for the Quarter Ended September 30, 2010

 Note 6. Mergers and Acquisitions

13. We note your disclosure that on July 1, 2010 you increased your ownership interest in an
existing equity investment and as a resu lt, recognized a gain, representing the
investment’s fair value imme diately before acquiring cont rol, of $1 million.  Please
explain to us the nature of this transaction including the amount paid to acquire the
additional ownership interest and the percentage of your ow nership interest both before

Mr. Stephen J. Thomas GAIAM, Inc.
November 23, 2010 Page 5

and after the acquisition.  Als o, please provide us more details as to how the gain of $1
million was calculated or determined.   See guidance in ASC 805-10-25-10.

Definitive Proxy Statement on Schedule 14A
 Election of Directors, page 3

14. In future filings, please briefly discuss the specific experience, qualifications, attributes or skills of each director on a director-by-director basis.  Refer to Item 401(e)(1) of
Regulation S-K.

15. In future filings, please discuss whether your board of directors c onsiders diversity in
identifying nominees for dire ctor.  Also, if your board of  directors has a policy with
regard to the consideration of diversity in  identifying director nominees, describe how
such policy is implemented, as well as how your board of directors assesses the
effectiveness of such policy.  Refer to  Item 407(c)(2)(vi) of Regulation S-K.
 Compensation Discussion and Analysis, page 8

16. We note that you have not included any disc losure in response to Item 402(s) of
Regulation S-K.  Please advise us of the basis for your conclusion that disclosure is not
necessary and describe the process yo u undertook to reach that conclusion.
 Elements of Our Compensation Program, page 9

 Annual Incentive Bonus, page 9

17. We note your disclosure that “[t]he total bonus  award is determined according to the level
of achievement of both the objective performan ce and individual performance goals.”  In
future filings, please include qualitative and quantitative disclosure regarding the determination of goals or targets and the goals  or targets actually reached.  Please note
that qualitative goals generally need to be pr esented to conform to the requirements of
Item 402(b)(2)(v) of Regulation S-K.  To the extent you believe that disclosure of the
goals or targets is not required because it w ould result in competitiv e harm such that the
goals or targets could be excl uded under Instruction 4 to It em 402(b) of Regulation S-K,
please provide (on a supplemental basis) a detailed explanation for such conclusion.
Please also note that to the extent that you have an appropriate basis for omitting the
specific goals or targets, you must discu ss how difficult it would be for the named
executive officers or how likely it will be for you to achieve the undisclosed goals or target levels or other factors.
 Summary Compensation Table, page 10

Mr. Stephen J. Thomas GAIAM, Inc. November 23, 2010 Page 6

18. In future filings, please clarify that th e amounts listed in the “Stock Awards” and
“Options Awards” columns of the “Summary Compensation” table have been calculated
based upon the aggregate grant date fair valu e computed in accordance with FASB ASC
Topic 718.  Refer to Items 402(c)(2)(v) and (c )(2)(vi) of Regulation S-K.  Similarly
revise your disclosure under the “Director Compensation Tabl e,” at page 5.  Refer to
Items 402(k)(2)(iii) and (k)(2 )(iv) of Regulation S-K.

19. We note that Stephen J. Thomas was appointed as your Chief A ccounting Officer in
November of 2009.  We also note that Mr. T homas signed your Form 10-K for the fiscal
year ended December 31, 2009 as your princi pal financial and accounting officer.  In
future filings, please include compensation information for all named executive officers.  Refer to Item 402(a)(3) of Regulation S-K.

We urge all persons who are responsible for th e accuracy and adequacy of the disclosure
in the filing to be certain that the filing include s the information the Securities Exchange Act of
1934 and all applicable Exchange Act rules requir e.  Since the company and its management are
in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy
and adequacy of the disclosures they have made.
 In responding to our comments, please provi de a written statement from the company
acknowledging that:
• the company is responsible for the adequacy and accuracy of the disclo sure in the filing;

• staff comments or changes to disclosure in response to staff comments do not foreclose
the Commission from taking any action with respect to the filing; and

• the company may not assert staff comments as a defense in any proceeding initiated by
the Commission or any person under the federa l securities laws of  the United States.

You may contact Claire Erla nger at (202) 551-3301 if you have questions regarding
comments on the financial statements and related matters.  Please contact Donald Field at (202)
551-3680 or me at (202) 551-3813 with any other questions.

Sincerely,

Linda Cvrkel Branch Chief