Bryan Goldberg: All right. And we’ve got time for one more question, and that’s going to come from Maria Ripps on AI. It seems like across the space, generative AI-powered tools are improving advertiser creative and leading to better KPI performance. Is Spotify investing in generative AI to improve its products for advertisers? And if so, are you seeing any tangible improvements in ad performance?
Daniel Ek: Yes. So there are plenty of things we’re doing, generally speaking to AI and machine learning to improve our advertising products, everything from improving, of course, targeting and so forth. But as you’re speaking to generative AI specifically, I think the biggest single thing we could do and that we’re experimenting with and the teams are experimenting with is enabling more opportunities for advertisers creative to be created. So let me expand on that for a moment. So if you think about our advertising format relative to, say, many others, it lives in this kind of a nice segue on the one end where it is not as easy to produce as text ads. What you see on other platforms. And it’s obviously not as hard to produce as a video ad.
And so we think there’s an enormous opportunity for us to apply generative AI to create really compelling audio advertisements for marketers. And today, creating a great audio ad is something that’s quite costly and quite expensive for marketeers to do. They obviously already make that investment when it comes to video because there’s plenty of platforms that are available, but we’re one of the few that offers audio ads in a big way on the scale that we’re doing. So that’s definitely a bit of a hurdle getting advertising on there. So what generative AI has the promise to do is, of course, to allow for that creative cost to come down. But not only that, but it allows you to scale that creative in unimaginable ways. So you can translate whatever creative you have lots of different languages.
You can use the same voice actor, but instead of producing one or two ads, you can have 1,000 or 10,000 or even 100,000 ads that are individually created to each user that gets to hear this. So there’s lots of possibilities that lowers the barrier to entry for marketers on the ad side using generative AI. And of course, there’s also lots of opportunities of creating more compelling ads which means they will perform better for marketers as well. So we’re really excited about it. But the level’s at this is early days, and we are definitely experimenting with the teams on how to do that. And I think it can be a real catalyst for our ads business going forward. But again, to caution everyone, it is early days and plenty more will happen in this space to bring costs down further and increase quality further, just throughout the explosion of all the tools from OpenAI to Google’s tools to LAMA and all the other things that are happening across the ecosystem.
So this is not just Spotify, but it’s the entire ecosystem that’s driving this development further. But I think we have a unique opportunity in our ad product to bring to bear something where you will, of course, see generative video ads, but I think that’s a little bit further into the future than seeing generative audio ads in a big way. So we’re excited about being able to bring that to market hopefully relatively soon and then playing a big part in 2024 and beyond.
Bryan Goldberg: Great. Thanks, Maria. And that’s going to conclude our Q&A session on today’s call. And so with that, I’m going to hand the floor back over to Daniel for some closing remarks.
Daniel Ek: All right. Well, thank you, Bryan. So in closing, as you can see, we’re feeling very good about the progress and results. So lots of the actions we’ve taken over the last 12 months are really bearing fruit. And I feel very confident that we are well on our way of being both a great product and a great business. So thank you again for joining us. And as usual, please feel free to check out our For The Record podcast dropping later today.
Bryan Goldberg: Okay. And that concludes today’s call. A replay will be available on our website and also on the Spotify app under Spotify earnings call replays. Thanks, everyone, for joining.
Operator: This concludes today’s conference call. Thank you for your participation. You may now disconnect.
End of Q&A:
