Operator: Our next question comes from Ben Swinburne from Morgan Stanley. Please go ahead with your question.
Benjamin Swinburne: Thank you. Good afternoon. Bob, we’ve — the press is out with the price increase information for later this year tonight. I’m just wondering now that you’ve been through one Disney+ price increase here in the U.S. and multiple Hulu and ESPN increases sort of how you’re thinking about the pricing power of the product as you go into these even more significant increases and whether you think you can hold your customer base as you raise prices. And obviously, some big news with ESPN Bet. Why now and why PENN? Can you just talk about your vision or Jimmy’s vision for the ESPN product over time that stems from this announcement and other thoughts on ESPN’s future?
Robert Iger: Ben, as you know, I think as we’ve said before, we took a pretty significant price increase at Disney+ sometime late in calendar ’22. And we really didn’t see significant churn or loss of subs because of that, which was actually heartening. It’s important to note, though, that the price increase that we’ve just announced is a price increase for the premium product or the non-advertiser-supported product. We’re actually keeping the advertiser supported product flat in terms of prices. That’s being done for a reason. Obviously, as has been noted by Kevin in his remarks, the advertising marketplace for streaming is picking up. It’s more healthy than the advertising marketplace for linear television. We believe in the future of advertising on our streaming platforms, both Disney+ and Hulu.
And we’re obviously trying with our pricing strategy to migrate more subs to the advertiser-supported tier. It also should be noted, as I think I mentioned in my remarks, that a substantial amount of new subscribers to Disney+ are signing up for the ad-supported tier, which suggests that the pricing is working for us in that regard. So we’re looking at this very carefully. One thing I think that I should also note is that we grew this business really fast, really before we even understood what our pricing strategy should be or could be. And we’re really just getting at, and I’d say in the last six months, the pricing strategy that’s really aimed at enabling us to improve the bottom line ultimately to turn this into a growth business and as a component of that, obviously, to grow subs.
Benjamin Swinburne: On ESPN?
Robert Iger: On ESPN Bet, you say why now? Well, we’ve been in discussions with a number of entities over a fairly long period of time. It’s something that we’ve wanted to accomplish, obviously, because we believe there’s an opportunity here to significantly grow engagement with ESPN consumers, particularly young consumers. And PENN, why PENN? Because PENN stepped up in a very aggressive way and made an offer to us that was better than any of the competitive offers by far. And we like the fact that PENN is going to use this as a growth engine for their business. And we actually believe and trust in their ability to – in this partnership to grow their business nicely while we grow ours.
Benjamin Swinburne: Thank you.
Alexia Quadrani: Operator, next question please.
Operator: Our next question comes from Michael Nathanson from MoffettNathanson. Please go ahead with your question.
Michael Nathanson: Thanks, Hey, Bob. I have a few, if you could. One is, given the thinking you’ve done about the future of Disney, why does it make sense to create two Disney companies: one focused on parks, CP, Disney+ and then the studio IP that drives that flywheel, and then one on everything else? So why not make a clean break? And then secondly, on ESPN, you’ve been talking about partnerships. I wonder if you have a vision for the streaming content vision of ESPN that’s different than the linear one we see, perhaps a sports funded with other networks or with lead partnership. So can you just expand on how the product will look differently down the road in streaming than it does now and late on (ph)?
