Shweta Khajuria: Sure. I was just wondering what you think if the lawsuit goes against you, I mean you mentioned that you’ve been fighting the fight, but that fight could get a little bit tougher in the event that you lose the lawsuit. So how does the business change, and what are your thoughts for that event happening?
David Gandler: Right, well, as I said, we’re fighting for our customers. We don’t anticipate — well, first of all, losing the lawsuit doesn’t really change anything, as we said. If things would remain status quo, we’d have to deal with unreasonable pricing and above-market terms. And so I don’t believe that any of these companies would retaliate against us for filing what we believe is a credible complaint.
Operator: Your next question comes from the line of Clark Lampen from BTIG. Please go ahead.
Clark Lampen: Thanks for taking the question. Good morning. John, I wanted to follow-up on some of the ad comments. You mentioned that you were seeing momentum and sort of demand persist beyond 1Q and into 2Q and 3Q. Could you help us understand, I guess, what sort of baked into guidance for the year and how much, I guess, the lift that we’ve seen in the back half of 2023 is systematic or maybe conversely a function of some of the improvements in the go-to-market that you implemented?
John Janedis: Yes, sure, Clark. As you know, we don’t guide specific advertising. And so, again, I’ll start with Q1 in terms of the double-digit growth. I’d say, hard to say what specifics are 2Q to 4Q, but we continue to expect growth. I don’t want to be more precise than that, just given lack of visibility. I would tell you that from a direct and programmatic guarantee perspective, we need to see momentum there in terms of mix improvement. And so that number kind of tripled, call it from around 6.5% of the total being programmed — those two, I should say, versus 90% plus programmatic. In the fourth quarter, it was more like 20%. I’d say for 2024, that number will improve. I would also remind you, though that a fair amount of the political money comes in on the programmatic side.
But if I kind of pull that out on a like-for-like basis, direct will be call it low to mid-20s, I would assume. And that, also, as you know, comes with a benefit in terms of pricing. And so, a higher CPM for that business relative to the programmatic business. You didn’t ask this, but from a — given the supply coming on, like we spend time talking to our teams around that, there is a little bit of weakness on pricing, call it in the long tail. I’d say for prime, we look at that as some more of undifferentiated supply that’s seeing price and pressure. But given our sports focus, I’d say we’re relatively immune to that.
Clark Lampen: Okay, and kind of a bigger picture question, but in the shareholder letter, you sort of emphasize that you want to continue delivering a differentiated experience for consumers. I was wondering if maybe you could shed some light on whether there are feature updates or releases that you guys have planned for 2024 that you’re comfortable talking about at this juncture or just sort of broadly, sort of what I guess will help bring that sort of differentiated experience to life for the user?
David Gandler: Yes, why don’t I take that question? So, I think over the last year and a half since our acquisition of Molotov, we’ve been very focused on the platform. This is a very forward-thinking company. We’ve been ahead of the curb now on multiple fronts for many years. And the three areas that we’ve really focused on is really developing a backend driven platform that enables us to rapidly and seamlessly release product features. That’s important, because we collect a lot of data, and we’re doing a lot of A/B testing. Hundreds of A/B tests are running simultaneously. And that will inform us on the direction we’re going to take. Some will be larger bets, some smaller bets. The second piece is the advanced data and AI platform that we’ve really developed.
And we started to release some features. I think we’ve announced the instant headlines that we’re starting to see some tractions with. If you’re not familiar with that feature, it’s a feature that allows to overlay the thumbnail on the home page that will immediately recognize what is being discussed on a newscast. So, if you’re talking about the elections, you’ll quickly see a headline change to whatever is there, so consumers are more apt to click on that. And the last thing is just the flexible architecture that we’ve built that allows us to rapidly make changes to configurations, which enable very quick rollouts efficiently across the globe. Again, right now, we’re very focused on our U.S. plan in achieving our profitability targets in 2025, but the baseline on the back end of the platform is prepared.
We’re running some tests, as I said, and we’re looking forward to starting to roll out features toward the back half of the year. The first feature, as I mentioned in my opening remarks, was our premium platform, which will give us an opportunity to collect even more data. So, we’re very excited. We’ve always said that we wanted to compete on a non-exclusive basis on fair terms. And we look forward to doing that.
Operator: Your next question comes from the line of Jim Goss from Barrington Research. Please go ahead.
Jim Goss: Good morning. I had a couple of questions. One, I was wondering about your programming fees with your program providers. Are they generally on a per sub basis, or are they on a sort of aggregate basis for certain markets? And on a related basis, how many options do you feel you would be inclined to provide consumers in terms of mixes of programming in a given market to provide the choice you think they deserve? And then, secondly, rest of the world is fairly modest and stable. And I’m wondering what your commitment to that effort is and what is the continuing rationale?
