Bob Iger : Okay. You asked a lot of questions on a lot of different subjects. I’ll take the first one on park’s timing and location. We’re already hard at work at basically determining where we’re going to place our new investments and what they will be. You can pretty much conclude that they’ll be all over, meaning every single one of our locations will be the beneficiary of increased investment and thus increased capacity, including on the High Seas, where we’re currently building three more ships. And in a business that is obviously, extremely positive to us, we may look expansively, at least in the next decade in that direction. I’m not going to really give you much more of a sense of timing, except that we’re hard at work at getting these things basically conceived and built.
And we’ve got a menu of things that will basically start opening in ’25, and there’ll be a cadence every year of additional — basically additional investment and increase capacity. I’ll let Hugh take care of the paid sharing. Hugh?
Hugh Johnston : Yeah.
Bob Iger : On the sports service and the pricing, I think the way you have to look at it is the sports service is going to be substantially less expensive to consumers than the big bundle that they’d have to buy to get those same channels on cable and satellite. And again, designed for two things. One, we believe there are a number of sports fans out there that want to watch sports on television but didn’t want to sign up to the big cable and satellite bundle. And so we think they will be accretive to us. We also believe that either consumers have left the bundle because it wasn’t serving them well or they may leave the bundle, and we want to make sure that we grab them, too. So we view this whole thing as, one, being a good proposition for sports fans because of the cost and certainly being positive for us because of the dynamics in the marketplace right now.
Hugh Johnston : Okay. And Jessica, I’ll handle the paid sharing question. We have sized it. I don’t want to put a specific number out there right now because these numbers are obviously rough estimates anyway. Suffice to say that the opportunity that we see on a percentage basis probably isn’t all that dramatically different from what our competitor has found in terms of their subscriber base. In terms of getting at it, there’s a couple of actions that we’ve taken in order to do that. Number one, we have some — made some changes to the user language that we have in the U.S., Canada and certain markets so that we’ll actually have the opportunity to act on the paid sharing opportunity. Number two, the accounts that we think are doing unpaid sharing right now will get communication this summer, and we’ll give them opportunities to allow their borrowers to start new subscriptions.
And then later this year, we’ll actually also have account holders who want to allow further individuals to access their accounts from outside that they’ll be able to access the account, but they’ll be able to do so for an additional fee. So we’ve got a number of tactical actions to take in order to take advantage of what we think is a pretty good sized opportunity in front of us. And it’s one of the things that gives us confidence in our subscriber growth numbers.
Alexia Quadrani : Thank you. Operator, next question, please?
Operator: Thank you. And our next question comes from Steven Cahall with Wells Fargo. Please go ahead.
Steven Cahall : Thank you. So Bob, you mentioned a lot of content in your remarks. It seems like the operations are really starting to hum again. But I think the lifeblood of the company is always going to be the studio output. It drives so much culture. I think that’s an area you’ve said that you’ve been spending a lot of time on. Do you feel like the content is also now turning the corner like you’ve seen in the operations? And if so, when do you think we might see some of the results of that renewed focus on the studio output? And then, Hugh, I think the inevitable question with the buyback announcement is what you expect you might end up ultimately paying for Hulu. Just wondering if you have any sense on the timing of that outcome or situation. And related to that, I think the exceed $7.5 billion in savings was a bit new. Curious just where you found those extra buckets of cost savings. Thank you.
Bob Iger : Steven, I feel great about where we are with the studio. Let’s not lose sight of the fact that in the last year, the studio had some real success, not to suggest that we didn’t have some films that were not successful that we were really disappointed in, but we also had some great success too with the Guardian sequel and Avatar at the end of calendar ’22 but part of fiscal ’23. One of the things that I’ve been saying before is that volume sometimes can be detrimental to quality. And in our zeal to greatly increase volume, partially tied to wanting to chase more global subs for our streaming platform. Some of our studios lost a little focus, so the first step that we’ve taken is that we’ve reduced volume, we’ve reduced output, particularly in Marvel.
When you fix or when you address these issues with — in movies, you do three things. You get aggressive at making sure the films you’re making can be even better. Sometimes you kill projects you don’t believe in. And of course, you put new things in the pipeline that you do believe in that you have much more confidence in. And we’re doing all of that. I’ve also observed over the years that managing creativity sometimes is best done with great partnerships. And I have established great partnerships with the people at our company that really manage their creativity, Alan Bergman with the studio, Dana Walden on the television side, Jimmy Pitaro at ESPN. And the partnership that Alan and I have is a strong one, and we believe that the time that I’m now devoting to this and the attention that the two of us are giving this business not only will bear fruit, but it’s already starting to.
We’re very bullish about the films coming out. We mentioned Insight Out 2, and we talked about Deadpool and the Planet of the Apes film. We feel good about that. Obviously, the end of the calendar year, we’ve got Mufasa, prequel to Lion King. We are very excited about the addition of Moana, which is the number one streamed movie of — across all streamers in the U.S. in ’23 and is at over 1 billion hours of consumption on Disney+. And that’s now going to be released in November. And then I mentioned what we’re doing after that. I’d say we’re leaning a little bit more into sequels and franchises, some that we feel great about, like Toy Story is — for instance, obviously, Star Wars, Avatar, we’ve talked about. Marvel is starting to focus on some of its stronger franchises going forward, but I’ll leave it at that.
And I think given the environment and given what it takes to get people out of their homes to see a film, doing that, leaning on franchises that are familiar is actually a smart thing. So we’ve got work to do still. We’re not resting on our laurels or sitting on our hands. We’re working hard at it, but I feel quite good about the trajectory.
Hugh Johnston : Right. And Steve, from my perspective, regarding Hulu timing on that, we’ve got a pretty clearly defined process. That process is going to take a little bit of time based on the work that needs to go into valuing the business. I would expect before we get to the end of the year that we should have this figured out and closed. Regarding cost savings, it’s pretty well spread out across the board. One of the things you tend to find is when a company goes on a cost effort, once you start to build momentum on that, people tend to find additional opportunities. And that’s what gives us the confidence around the numbers to at least meet if not exceed them. So no one specific area. It’s content side as well as the SG&A side. I think we just have momentum on managing our expenses more tightly, which is great news, I think, for investors.
Alexia Quadrani : Thank you. Operator, next question please?
Operator: And our next question today comes from Bryan Kraft with Deutsche Bank. Please go ahead.
Bryan Kraft : Hi, good afternoon. Since there’s so much discussion about bundling and distribution, I was wondering if I could ask you if you could share any observations related to Charter integrating Disney+ into its pay TV programming tiers. Is there anything you could say about the percentage of customers actually using it or engagement levels relative to the average Disney+ subscriber? And maybe lastly, do you think that this is a model that you’d like to replicate with other pay TV distributors over time as your agreements come up for renewal? Thanks.
Bob Iger : Thanks, Bryan. It’s really early. They didn’t start introducing this to their subscribers really until January, and they didn’t roll it all out right away. And so we’re seeing some stats on this that are somewhat encouraging, but I want to be careful that because it’s early, we’re not sure whether those trends will continue or not. I do think that this kind of arrangement is one that we’ll likely see with other multi-channel distributors. It seemed like it was a win-win for both of us. Important to us, obviously, because it gives us access to more of their customers and important to them in terms of bundling this service with their multichannel customers. So I think it’s — again, I think you’ll see more in this direction, but too early yet. We may have more to say about this next quarter when we know a lot more.
Bryan Kraft : Thank you.
Alexia Quadrani : Operator, we have time for one more question.
Operator: Thank you. And our next — our final question today comes from Michael Morris with Guggenheim. Please go ahead.
