Craig Moffett : Thank you.
Hans Vestberg : Thank you, Craig.
Brady Connor: Brad we are ready for the next question.
Operator: The next question comes from Greg Williams of TD Cowen. Your line is open.
Greg Williams: Great. Thanks for taking my questions. You provided some great color on ACP. I think you said it could be a 50 basis point hit. I’m just curious if we can drill down there. Is that more of an ARPU hit with these new plans that are coming out, or is it more on the disconnect side? Second question is just on fiber-to-the-home and the open access models that we’re seeing. We’ve seen some news flow with Tillman and Intrepid, et cetera, on open access and maybe even T-Mobile. And just trying to gauge your appetite to ride some of these open access CapEx light models if they come to fruition. Thanks.
Hans Vestberg: I can take the first question — the second question first. As we haven’t done any open access deals yet, you can see that the appetite hasn’t been that big. Anyhow, we’re going to evaluate any type of opportunities that can fortify how we deliver to our customers. So far in this environment, with the very high capital cost, et cetera. It hasn’t — we haven’t find a good return on investment on it. And again, we are very financially prudent. And remember, we have fixed wireless access, we have our Fios, we sort of — we have [own this] (ph) economics on basically everything we’re doing. That’s why our return on investment is the highest in the industry and our EBITDA is the highest. We will continue to be disciplined. That doesn’t mean I’m not going to look into other models, but right now there have not been any models that is appealing to me and the team and for our shareholders.
Tony Skiadas: And then Greg, on your question on ACPs, so as we said, it was up to a potential 50 basis points of headwind in service revenue. And that’s a combination of ARPU and churn and it’s lower ARPU. And we also said the margin exposure from ACP is also very, very small.
Greg Williams: Got it. Thank you.
Brady Connor: Yeah. Thanks, Greg. Brad we are ready for the next question.
Operator: The next question comes from Bryan Kraft of Deutsche Bank. Your line is open.
Bryan Kraft: Hi, good morning. I had two if I could. First, could you provide an update on your efforts to pursue BEAD funding? Are you seeing any progress at the state level in establishing the rules? And based on what you are seeing there, are you more encouraged or discouraged by what you’re seeing? And then separately, I was wondering if you could just provide any color on the company’s performance in the first quarter within the larger metro markets relative to smaller mid-size markets and consumer. Thank you.
Hans Vestberg : Thank you. On the BEAD funding, yeah, I think that has been widely reported in the press. It is of course a complicated process to get the BEAD money out, et cetera. So we bid where we see it makes sense with return on investment and the subsidy is coming in there. There are some other broadband money coming into the market from the previous funds which were winning. We just had some quite large wins here recently in Pennsylvania. So we’re using it but we do it when it makes sense from a profitable point of view. But again, it’s probably going to take some time when we see this money rolling out. Second question is for you. I [think you remember] (ph) …
Tony Skiadas: Yes, it was the question on the C-band market. So on the C-band markets — in the early markets, the performance is much better. As we said earlier, the churn is much better, 4 basis points better in churn. The premium mix is also a lot better, and we see meaningful increase in gross add performance as well. So we’re really, really pleased with the performance in C-band.
Bryan Kraft: Thank you very much.
Brady Connor: Yeah, thanks, Bryan. Brad, we have time for one more question, please.
Operator: Your last question will come from Peter Supino of Wolfe Research. Your line is open, sir.
Peter Supino: Hi, good morning everybody. I wondered if you could talk about SG&A growth. It was up 11% in business and 4% in consumer. It was nicely offset by cost relief from lower upgrades. I’m just wondering if you’re spending back some of that upside on SG&A and how we might think about modeling operating leverage and specifically SG&A going forward. And then if anybody would be willing to provide an update on your project of deploying millimeter wave spectrum in support of the FWA business to multi-dwelling units. Is that working the way you hope? And if so, could that provide upside to your long-term broadband growth targets? Thanks.
Hans Vestberg : Thank you. On the SG&A, we’re very focused on seeing that we continue to get full leverage on the growth that we have right now. So the team is really focused on taking out costs. And I said, we are on track with that. We have a lot of initiatives ongoing. Tony will give you some more puts and takes on the SG&A in the quarter. On the millimeter wave MDU solution, that is progressing. We have said it will come in the second half, latter part of this year, in commercial. But we’re piloting it right now and it’s performing really well. So we feel really good about it. And it will over time, of course, add opportunity for us on MDUs that we haven’t served with a fixed wireless access so far. So it will be an addition over time. Tony?
Tony Skiadas : Yeah, Peter, on your question on SG&A, some of that in the quarter is a function of the upfront work on transformation initiatives that will abate as the year progresses. And we also see pressure, year-over-year pressure on the handset insurance claims and we expect that to level off in the second quarter. We expect to see further operating leverage in the second half of the year.
Peter Supino: Thank you very much.
Brady Connor: Great, thanks Brad. That’s all the time we have.
Operator: Ladies and gentlemen, this concludes the conference call for today. Thank you for your participation and for using Verizon Conferencing services. You may now disconnect.
