In terms of the prioritization of line extensions over the DAA or DOCSIS 4 upgrade, it wasn’t so much about prioritization. It was really about certification of the DAA equipment taking a little bit longer, which was pushing out the timeline for the rollout. And so, the trade-off we had is could you do it the 1.2 gigahertz high-split upgrade under, what we call, an integrated CMTS environment. And do more of that footprint to keep the original pace or should we slow it down just a tad to make sure that we allowed for a catch-up of the DAA certification process so that you can move to high split with distributed access architecture as well as the 1.8 gigahertz and the rollout of DOCSIS 4.0, we chose the latter to make sure that we were having as much of the footprint with the full capabilities of DOCSIS 4.0 over time.
The caveat is, if we get into couple of years from now, we see opportunities to pull capital forward. We’ll of course do that, but this is our best view of where we’re going to spend capital. And we thought it was worthwhile to show that to make sure people understand that it doesn’t — that higher level of capital expenditure doesn’t go on into perpetuity.
Benjamin Swinburne: Thank you.
Jessica Fischer: Yeah. On the EBITDA performance inside of 2024, I guess — I’m not going to give EBITDA guidance, but I think we can talk about the few things. So, you do have a political advertising year, that is a tailwind. We have — so we’ve fully lapped the investments that we made in the employee population. And from an expense outlook perspective, I think my expectation is that we’ll be able to keep cost to serve essentially flat on an absolute basis. And in sales and marketing, you might have some growth, but it will be small in the 2% to 3% range. And we continue — as I said in my remarks, we’re taking a look at expenses all across the business to identify areas where we can be more efficient and reduce costs without impacting our service levels and our sales capability.
And so, we fully understand that we need to maintain EBITDA growth in this environment and strong EBITDA growth coming into what, as you note, should be a stronger year in order to be able to continue focusing on what we want for the long term, which is to be able to invest to grow in the long term and to return to that sort of Internet customer growth in the long term. So, I think the dynamics in the background are happening to make that growth happen. That’s where we are.
Benjamin Swinburne: Okay. Thank you.
Chris Winfrey: Thanks, Ben.
Stefan Anninger: Thanks, Ben. Luke, we’ll take our next question, please.
Operator: Our next question will come from the line of John Hodulik with UBS. Your line is now open.
John Hodulik: Great. Thanks for that color, Jessica. Just a follow-up on EBITDA growth and one of the components, revenue per customer. It’s been relatively flat for the last couple of quarters and there’s a lot of moving parts in terms of pricing and customers rolling-off Spectrum One. But, how should we think about progressing through ’24, especially with the — I think the most recent data price increase in August? And do you believe your pricing power in the broadband market has changed given the new sort of competitive landscape we have, or can you continue to push pricing as that lapse mid-year? Number one. And then, on the mobile strategy, anything you can tell us about what mobile is doing in terms of lowering churn in the broadband market?
Is it also helping you in terms of new connection and driving new subscribers or just really churn reduction? And then, anything we should expect to change as you sort of proceed with some of the build out measures you’re taking to add your own capacity?
Jessica Fischer: Yeah. So, I’ll start with ARPU. When you look at average revenue per customer overall, John, the biggest factor that’s keeping it flat is the rate of video penetration. So, what matters there is the extent to which we can retain video customers with some of the package and pricing strategies that we have. If you isolate and you sort of pull out Internet ARPU, you can see even in the remarks that I made on the quarter that Internet ARPU continues to grow, and when you pull out the Spectrum One Mobile allocation, continues to grow at a rate that’s consistent or even a little higher than historical level. On the mobile side, I talked about it on the last call. As you have — so because we’ve sort of lapsed the free line offer, the number of free lines that we have in the system over the course of 2024 is more steady than it was in 2023.
So, you’ll also see that the impact of that mobile allocation over to the Internet should steady over time. And you’ll have, just as a matter of math, more paying customers in the base as a proportion relative to the free lines. So, I think that’s the piece there. I don’t know, Chris, do you want to talk about pricing power?
