Ladies and gentlemen, thank you for standing by and welcome to Discovery, Inc. Fourth Quarter 2020 Earnings Call. At this time, all participants' lines are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions].I would now like to hand the conference over to your speaker today, Mr. Andrew Slabin, Executive Vice President, Global Investor Strategy. Sir, you may begin.

Good morning, everyone. And thank you for joining us for Discovery's First Quarter 2020 Earnings Call. Joining me today are David Zaslav, our President and Chief Executive Officer, and Gunnar Wiedenfels, our Chief Financial Officer. You should have received our earnings release. But if not, feel free to access it on our website.On today's call, we will begin with some opening comments from David and Gunnar, and then we will open the call for questions.Before I start, I would like to remind you that comments today regarding the company's future business plans, prospects and financial performance are forward-looking statements that we make pursuant to the Safe Harbor provisions of the private Securities Litigation Reform Act of 1995.These statements are made based on management's current knowledge and assumptions about future events and they involve risks and uncertainties that could cause actual results to differ materially from our expectations.In providing projections and other forward-looking statements, the company disclaims any intent or obligation to update them. For additional information on important factors that could affect these expectations, please see our Form 10-K for the year ended December 31, 2019, and our subsequent filings made with the US Securities and Exchange Commission.And with that, I'd like to turn the call over to David.

Good morning and welcome everyone to our Q1 earnings conference call. These are clearly unprecedented times as we confront a challenge unlike anything in recent history.I want to start by thanking frontline heroes everywhere for the lifesaving work, especially here in New York, which has had a big battle on its hands – the doctors, nurses, EMTs, and all of the first responders. And on behalf of all of us at Discovery, we thank you.I am enormously proud of how our leadership team and employees have stepped up and pulled together during this time. They have done so with resilience, heart and creativity.Their health and safety is everything to us at Discovery and to me. With meaningful populations across Asia, Latin America and Europe, we have been at this for about three months, starting with office closures across Asia in January.I'm proud to say that our business has not missed a beat. Our early and continued investment in technology and automation, and moving our broadcasts and global infrastructure into the cloud is serving us very well at this time.We are extremely pleased with the level of productivity, the morale of our employee base, and how well we are able to serve viewers, advertisers and our key partners, even as we work remotely. We continue to have great command and control across our businesses everywhere in the world.With so much macro uncertainty, there are obviously a lot of questions at this time about impacts on our business, the direction of the economy and markets, and the broader video ecosystem.All well founded, and we are left with a number of unknowns ourselves. Yet, these uncertain times highlight the distinct characteristics of Discovery's business and the strategic advantages that set us apart.We have content leadership in core genres that are durable, popular and…

Good morning. Thank you again for joining us this morning. I'd like to echo what David said and thank all of the frontline workers who have tirelessly provided critical services and a big thank you to Discovery's dedicated employees working from home to ensure that our business remains on track.Turning to our Q1 results, we had a solid January in February before we begin to feel the impact from the COVID-19 pandemic. We did note a very modest impact to advertising specifically in Asia when we spoke with you last on February 27. This naturally evolved throughout the region and then into Europe beginning in early March, with closures in many of our key markets such as Italy and Poland, among others, followed by closures here in the US for a good portion of March.Though even with that, total revenues in Q1 were largely flat on a constant currency basis, while AOIBDA declined 3% year-over-year ex FX as we've continued with plans to invest and support our next generation initiatives.As a reminder, in late March, in conjunction with the move of the Olympic games from this summer to next, we recalled our forward-looking financial projections and outlook for both Q1 and the year.Let me review our key revenue drivers beginning with US advertising, which was flat versus the prior year. As noted, we did see some impact from the lockdowns in March with an uptick in cancellations and deferrals. To some extent, the rise in cancellations in March was offset by higher audience deliveries. With people isolating at home, delivery in the people 25 to 54 demo across our portfolio of networks increased by over 10% in total day versus the pre stay-at-home period.Audience growth has been particularly strong for our food and home networks, which provide useful ideas, comfort…

Thank you. [Operator Instructions]. Our first question comes from Jessica Reif Ehrlich from Bank of America Securities. Your line is open.

Thanks. I just have a couple of questions. First on sports, Gunnar, I wasn't clear on – you're not recognizing sports costs, but on a cash basis, are you paying right now? And if you are, what flexibility will you get kind of in the back end? And are you changing your approach to the Olympics now that they have moved? Is there anything different? Will the loss be the same a year from now? Sports is one thing.Direct-to-consumer on Food Network Kitchen, every day is like your Super Bowl unfortunately. It's good for you, but – can you give us an update on how it's doing? I know you moved out Magnolia timing, but if you can give us an update on direct-to-consumer.And then finally – sorry for so much – but cancellations were due last week for a third quarter. Can you give us some color on what you're seeing? Because your advertising actually so far seems actually pretty good.

Sure. Why don't I get started and then I'll pass it over to Gunnar? Having no sports is a challenge for all of us. But 90% of our deals have either force majeure provisions or provisions that specifically relate to us not paying for content that we don't get. And so, I think we did a particularly good job in our sports deals, which we expected they'll come back and it'll just be a move. But to the extent that they don't, we have a real opportunity with that.On the Olympics, we think it's going to probably be a little bit better for us because one of the issues with the Olympics is it's separated by such a long period of time. In terms of building our digital direct-to-consumer platform, the fact that we'll have summer and then winter only a few months apart, the fact that we can get advertisers into both of them together where we could string it together, and we're hoping that when people get to Tokyo, it's going to be a real opportunity for people to get back together with a lot of excitement.I think when sports does come back, it's going to come back very big. People are really yearning for it. I'm excited and talking to Jay Monahan, who is doing a terrific job as commissioner of PGA and we're, as you know, partners around the world, hoping to come back in June and has a great plan for it. And we're rooting for that. I think that we really need – we need sports.Having said that, what we're experiencing is different than what's here in the US. As I've said for a very long time, sports works differently outside the US. When people want sports, in most cases, it's on premium and…

Yeah. So, maybe just a couple of points to add. On the cash flow question for sports, it's going to be a mix so far. Most of the events have been postponed rather than canceled. So, you should expect not only P&L, but also the cash profile to be adjusting accordingly. And we will keep an eye on this as we go through the rest of the year.Regarding the Olympics, we will have two events much closer together, which should be a positive. We also have a little more time to get to prepare and to prepare the ad market to go to market with bundled packages. So, those would be a positive. But bottom line is it's a little early to sort of start about a very specific guidance. But right now, I wouldn't see a material change versus what we had guided for this year.And then, regarding the cancellations, you're right, the upfront opt-in cancellation period has started. It's way too early to have a view. And as I said a couple of minutes ago, we will make sure that we work in partnership with our colleagues here and work through this together.

Thank you.

Thank you. We'll take our next question from Ben Swinburne from Morgan Stanley. Your line is open.

Good morning. David, I just want to pick up on the comments you were making before about the sort of sports subsidy in the US and what's happening to the ecosystem. And I think everything you're saying makes a lot of sense. And all of these trends are probably accelerating because of this financial and health situation going on as you pointed out. You have been talking about a US OTT offering of your sort of core content now for maybe a year, maybe a little less. And I'm just wondering if what's happening in the marketplace with cable operators increasingly just passing on these sports costs to the consumer, pushing people out of the bundle is accelerating your thought process or changing how you think about it. And your reach is falling in the US, really with no fault to you guys. It's really an industry issue. And you've got, obviously, massive consumption through streaming, including on a lot of your products, but you still haven't laid out to us or talked publicly more about how you plan to expand the kind of the core IP. I don't know if you're ready to talk about that in more detail, but I'd love to just get an update on that because I think it's a really interesting opportunity for you guys.

Sure. Well, look, I think the advantage to us right now is that people are spending a lot more time with our channels. Our share is up really significantly everywhere in the world. And it's two months here. It's longer than that in a number of areas in Europe and Asia. And behaviorally, people are spending a lot more time with our characters and our channels. And we think that that's a huge benefit to us on this existing platform because there's a real habit here. And as well, we're seeing it in a meaningful way on GO. We're not able to fully monetize all the share, obviously, domestically and around the world. But we view this really as an important moment for us because, as a company, our focus is to entertain and, when we're at our best, to inspire. We have a great, great creative team that's doing all kinds of content from home. We're learning a ton. And it's resonating with distributors. They've come to us and said, could we add DIY? Many of them to all of our subscribers. Can we add cooking to all of our subscribers? Do you have a lot of other channels that are very strong, your Hispanic channels, can we add them? This is going on in Latin America, in Europe, in the US. And they're getting very good feedback and the viewership is increasing significantly.And so, I think the viewership we're getting in the average age on GO of 26, the viewership we're getting for all of these channels and all of our characters around the world reinforces how valuable what we have is and it also – as these distributors take a look in the US, there's going to be, I believe, more and more pressure on them because…

Right.

We have been building. We have a very strong team. We have over 150 people and engineers working. We have slowed down a little bit because we can't hire new. But we're on track with our platforms. All of the problems we have outside the US are working exceptionally well. They're ours. And the platform that we're working on here in the US, to give us full optionality to go right to the market, is doing very well. And so, I think you'll hear more from us. But I think our IP looks stronger.And more and more, a lot of these other platforms that don't have a lot of content are seeing how much people are spending time with us and they're talking to us about whether our content would be available to them. And right now, we think our aggregate content is most valuable for us and for us to be able to continue to look at going to non-cable subs ourselves.

Right. That's really helpful. Just one quick follow-up on Food Network Kitchen. The Amazon announcement was quite interesting. I don't know, you probably don't want to share specifics, but I'm just curious if you're getting wholesale revenue or anything you can tell us about sort of the financial impact or even the kind of marketing push that's going to be associated with that Amazon offer to their Fire subs, Fire users.

I would just recommend that you all go to Fire. We're on the front page. We're getting equal billing with Hulu and some of the other big great platforms. And there are some days where they put us on – basically take over most of the page. And so, they're a great partner. They love the product. And we're rolling together.

Thanks a lot.

Thank you. Our next question comes from Michael Nathanson from MoffettNathanson. Your line is open.

Great. Thanks so much. David, a couple of questions for you. On the European side, where you have your sports [Technical Difficulty], are there any minimum number of hours you need to deliver to maintain any type of license fees? So, that's one.And two is, given how clean your company is on cash flow and the balance sheet, can you talk about maybe leaning into M&A and how you would think about M&A given how dislocated some of the valuations are around the world?

Sure. On the sports side, we don't have anything in our existing deals. When you look at our aggregate package that people are paying for in Europe, what we're delivering to customers is meaningfully higher than it was before. Ratings are down significantly on Eurosport and we'll be very excited when the sports comes back. But, no, there's nothing in those agreements.But, again, the sub people, whatever it's worth, is relatively small. It's very different than here in the US. It's not in the dollars or almost $10 range. It's much smaller. And so, distributors tend to look at our overall delivery and they're seeing that we're the top performer or one of the top performers in every market in terms of what we're delivering on a multichannel basis.On M&A, all I would say is that, it took us a very short time to absorb Scripps. Ken Lowe built a great, great company with a great culture and we've integrated it fully. We're really – this is the best of what Ken built and the best of what we built. We have a great leadership team that's fully integrated. We view it as really the best of both companies and it's presented that way. We're grateful for the great comfort channels that are now part of our portfolio here and around the world. It's been a huge help to us. We're so proud of those brands and all of that great talent that was added. And that deal worked out really well, as you know. We added over $1 billion of free cash flow and we did it in 18 months. And we went from 4.8 times to 3 times levered to below 3.5 times levered. And so, I think what we show to our board and to ourselves is…

Okay. And can I ask you one last one on the upfront. Given the strength of your verticals, given that you can actually have fresh content in the fall, how do you think about going to market in the upfront where others maybe can't sell anything right now? So, what's your strategy there?

Well, there is a divide in the market. And you'd expect that. It's such an unusual disrupted moment. But there's a number of – we're talking all of the big players and they're going to ultimately make the decision for their advertising clients. I'd say more than 60% to 70% of them are saying or more than 50% are saying, 'hey we're going to do a regular upfront.' And a number of them saying maybe we shouldn't do a regular upfront. Maybe we should go later and see what happens and move later. We're open for business. We have fresh content when others don't.And one of the things that we're seeing is the live and engaged viewership on our channels have never been higher. And when the advertisers are putting on content that's in the moment that recognizes what's going on in the world, the viewership of those commercials are up dramatically. People are watching the commercials when they're talking about, 'this is a tough moment in America and here's what we're doing.' People are watching it.And so, we're open for business. Those that want to move in the traditional window, we'll move with them. Those that want to move later, we'll move with them. And it's not for us to decide who's going to do better. It may be that the ones that moved early do a lot better and maybe the ones that moved later do better, but we're open for business.And in the meantime, we're reducing our – to the extent that we're not sold, we're reducing the amount of inventory that we're selling and we're finding that that also was helping our ratings. And that's something we need to do as an industry anyway.

Okay.

Thank you. Our next question comes from John Hodulik from UBS. Your line is open.

Okay. Thank you. Two questions. First, David, anything you can tell us about the pricing you saw on those recent renewals you mentioned. And then, a follow up to Michael's question. Obviously, $1.5 billion in cash, lot of liquidity, you bought back more stock than we expected before the outbreak. Can you talk about what you need to see going forward maybe just from a stabilization of the ad market or what it would take for you guys to restart the buyback? Thanks.

Okay. I'll have Gunnar answer. Why don't you start off, Gunnar, with answering the second part?

Yeah. As you read this morning, we did buyback some stock right after our full-year earnings call. As you would expect us, we've been a little more careful since the beginning of the full outbreak here. And as you would expect as well, we have taken precautionary measures to make sure that our capital structure is in good shape.And again, from what we're seeing right now, we continue to have a lot of confidence in our ability to generate free cash flow. We were free cash flow positive in the first quarter. From what we're seeing, we're going to be free cash flow positive in April, et cetera. But as you would expect, we don't have a lot of visibility into the second half of the year. And so, from the perspective of what I would have to see, clearly, we'd be looking at a signal of pick up in ad markets. And again, we're not giving guidance here. We don't have the visibility. We thought it was helpful to provide you with what we're seeing today, which is the April numbers. And from a booking perspective, slightly better in May and June. But as I also said, I'm just giving that to you guys in full transparency here, we're seeing a lot of rolling cancellations et cetera. So, take it with a grain of salt, yeah? So, that's really the point on capital allocation and buybacks.And then, the pricing on recent renewals, your first question, as you know, we don't disclose any details. But what I can say is that I'm very happy with those deals, as we said, many times before. We do believe that we have amazing content providers, amazing value to our affiliates, and I'm not surprised that again we were able to strike deals that are mutually beneficial, additional value on both sides. And in terms of the size of the portfolio, no re-gearing et cetera, et cetera. So, top to bottom, deals that are in line with what we have been seeing in the past.David, anything…?

The only other thing I would say is that there was a lot of talk – we even changed over the last several years, so that more than 80% of our value was against our top 8 channels. But all of our channels were renewed. Right now – and we got additional carriage for some of our channels in the renewals, in some cases meaningful additional carriage. And after Fox News launched, the next channel that launched was OWN, which became the number one channel for African-American women. That was us launching new assets with new IP that we can take around the world. Then ID, which became the number one channel or number two channel for women in all day, which was our second asset.And we think, now looking at DIY and the ratings and the fact that it's in more homes and what Chip and Joanna Gaines have been able to do and the reception for the great content that they created, not even just what they're doing themselves, but their curation and taste, that we have a chance to launch another good asset, really good asset that advertisers love, both on cable and in digital. So, we're very pleased with.The negative is that, look, we're cheaper than one regional sports network. So, in some ways, we're providing all this value with all of these characters and we are the new sports, our key networks. But on the other hand, we're very inexpensive. And I think the power of our channels is much more now as they take a look – as operators take a look, distributors, how much time are people spending with Food and HG. They're watching it all – the length of view is higher than almost any channel on cable.And so, I think the good news is that we're able to do good deals. The issue is that we're not getting paid close to what we deserve, a fraction of what we deserve, for what we're delivering, but we're going to keep working on it.

David, let me add one more point reflecting, Michael, on your question and, John, your question as well, both for M&A and buybacks. You heard me say earlier that we're in a very constructive dialogue with rating agencies. And you said – no, we're continuing to honor our investment grade rating. It's a big priority for us. And that's the backdrop against which you should take all these answers regarding whatever M&A, buybacks, et cetera.

Great. Thanks, guys.

Thank you. And our next question comes from John Janedis from Wolfe Research. Your line is open.

Hi. Thank you. David, you guys talked about pushing your OTT more aggressively in Europe. I'm wondering, does the COVID impact the rollout and can you give us an update on the Dplay expansion?And then separately, you talked about your short production cycle and fresh content. Can you give more detail on how you're thinking about availability of originals across the platform later this year and into 2021 relative to normal and to what extent the non-scripted programming is better positioned relative to scripted when production comes back online?

Sure. Kathleen Finch is just a great creative executive. Nancy Daniels. We have creative leaders at each of our channels and we have go-to talent that are authentic. They love to cook. Mike Rowe, I've been on the phone with him three times in the last week with ideas of what he could do and the excitement of shooting before the catch from his couch. So, we have a fully engaged creative team.And as Gunnar said, over 50 projects, 350 hours. And one of the things that we're – this idea of we're best when we're closest to real, if you script it, the talent on there, they can come out and people know them. But the idea that we could get Guy Fieri even close to live and maybe even eventually live from his kitchen, from his barbecue and we have found that the audience will go with us. And in some cases, they love it. 'Oh, look at that, look at Guy. His son is shooting it. I wonder what his son looks like. Look at his living room. Look at his kitchen. Guy, what's that book behind you there? Did you get any recipes from that? And so, we're seeing big social energy around it. Our talent is getting stronger.So, we already had a short cycle, but now we're finding that we can produce all this content and it's dramatically cheaper. And in many cases, it feels more authentic. And the audience loves it. And so, we're just leaning into it. Kathleen and Nancy and the whole team, Courtney White and Jane Latman. Jane runs HG and Courtney runs Food. We're on the phone with them every day. They're just super excited, and so is the whole creative team that they could do this.And so, I think…

Thank you.

Thank you. And we'll take our next question from Alexia Quadrani from J.P. Morgan. Your line is open.

Hi. This is Zilu Pan on for Alexia. Thanks for taking our question. Can you talk a little bit more about how your own streaming services has trended in the Nordics after the discontinuation of your carriage agreements?And then, just on production, are there any countries where you still might be able to shoot normally that you can take advantage of? Thank you.

Okay. Thank you so much. One point that I wanted to just add to the answer to John is, look, on golf, on the Eurosport Player, on cycling, we don't have sports, it's dropped off significantly as you would expect. And our free funnel is fine. We have people are coming in and they're reading from Golf Digest and they're seeing some short form content, but the fact that we don't have live sports is having a meaningful impact on those businesses, as you'd expect. And we think when they come back, it'll kick in.In terms of traditional production, there're some that have come back a little bit in Asia, but it's mostly shutdown. We have a lot of content that was shot that we're working on. We have content in our library. We're shooting new. But the ability to actually – we're not pushing for anyone to get out.We had this moment after we closed down where we had a number of cases – we have over 10,000 employees and it was tough. Those were 14 of maybe the toughest days for me in my life. Is everyone okay that has this? We had a number of employees that were struggling. And you feel it. You feel it because they got sick coming to work. And so, we're not in any rush to push any because we're working remotely so effectively. We look good. We haven't missed a beat. We've learned a ton, but we don't want to push anybody into the field. We don't want to have that feeling again. We had a call every morning on this virus, who has it, who's been tested, what's going on, who did they come in contact with. Really an extraordinary effort led by Adria Alpert Romm and David Leavy. It…

Let me maybe add to the Nordics question. We're seeing dynamic growth on our Dplay platform.Regarding the traditional affiliate deals, you mentioned sort of – having lost deals, we've actually gone dark with one traditional affiliate in Denmark and we're seeing very dynamic growth on our Dplay offering in that market more so than – or above the already dynamic growth in other markets.And beyond that, we're also very excited about sort of new types of partnership deals with the likes of Telia, Telenor, where we're engaging in broader partnership deals, both on the traditional side as well as in the wholesale B2C relationship for our direct-to-consumer products, which I think is going to be a very fruitful partnership mark.

Thank you.

Thank you. Our next question comes from Doug Mitchelson from Credit Suisse. Your line is open.

Thanks so much. A question for Gunnar, a multi-part, and then a question for David as well. Gunnar, OpEx coming in $100 million or so lower year-over-year in 2020. It's certainly interesting. When you look at the core decline of mid to high single-digits, how much of the costs that are coming out are temporary? How much is permanent?And then, you mentioned cost flex. To the extent that there's change in revenue versus expectations, where does that flex come from? Would the next round of cost mitigation start to impact DTC efforts or is there still a material amount of flex in the traditional business?And for David, it reference to Ben's question on streaming, before we start to run with the a la carte narrative for Discovery, do your existing deals with pay TV distributors have any limitations on Discovery going direct-to-consumer sort of a la carte? And I'm sure you would like to work with the cable guys on bundling with broadband. But do you have any concerns about putting satellite distribution at risk?And I guess, for fun, how much do you think consumers would be willing to pay for a standalone Discovery a la carte streaming service? Thanks.

Okay. Why don't I start and then I'll pass it to Gunnar? We don't have limitations, but we also have a hell of a business with our existing distributors. And I've been in this business for 30 years. And a lot of those distributors are my best friends. And we've done very well by supporting each other and working together. That's what we're doing with GO, with our authenticated product. And there's 30 million broadband-only subscribers. And so, whether it's Pat Esser at Cox or whether it's Dave Watson at Comcast or whether it's Tom Rutledge at Charter, they're in the broadband business. There is 30 million people that are broadband only.And so, we are in discussions with all of them about the fact that we have this great package of content. If you take a look at the front screen for Disney, you see Pixar and you see Marvel and you see Disney films and people look at that and go, oh, I love that stuff. And then imagine, they open up and they see HG and Food and Oprah and Discovery and BBC Planet Earth and then behind each of those circles is all the great talent that we have, and we've done a lot of research, and people look at that and they go, wow, those are my six favorite channels, or four of my favorite channels and those are my favorite characters.So, we all agree in talking to – everyone agrees there's a lot of value there. And so, I think you'll see, over the next year or so, our goal is going to be to do something with the distributors because they have direct access to those 30 million and they have enormously helped Netflix by promoting Netflix and by billing for Netflix and the churn for Netflix and any product goes down when an existing distributor that's billing bills for it and they have a good relationship with all those broadband subscribers because they're providing an incredible service.And so, I think it'll start with that and it has started with that. And so, I think when you see us move, you'll probably see us move broadly, but also in tandem in a way that creates value for both of us, which is what we've been talking about and I think what a number of the distributors that we're talking to feel good about and encouraged that instead of just doing our own thing, we're in talking to them about doing some things together.

Doug, then on the OpEx side, I want to answer this on a couple of levels. Number one is we're still enjoying significant impact from the transformation of our company. We had a full toolbox here of initiatives that we're still in full swing as we came into the year and we continue to deliver those. And some of the longer cycle cost improvements where we had to put systems in place, et cetera, we're also enjoying the fact that some of those investments are coming down, but we're reaping the benefits now. So, a lot of this is going to be lasting impact.Now, obviously, there is timing stuff. If you look at T&E, for example, you wouldn't expect us to spend a lot here. So, obviously, that is going to be fired up again once the global economy opens again, and that's explaining some of the variability.There's also variability, obviously, as previously pointed out in the direct-to-consumer space where we have a lot of subscriber acquisition costs that are variable, but also the pace at which we're hiring, as you would imagine, we're going little slower on hiring right now. So, all those expense buckets are going to start to ramp up.And then finally, there's content where obviously it's a function of the ecosystem's ability to produce and deliver content and the mix of sort of the in-home content that we've talked about versus, let's call it, traditional production.So, it's going to be a mix and that that's why we gave that range. Some of the expenses are going to come up when the economy opens again. Others are not. But I just want to reiterate the point, we had a large range of transformation initiatives going into this year. And as you would expect, we're also learning right now and there is additional ideas coming through and going through – in the pipe here right now. Honestly, this company is functioning very well in this environment and there are a lot of learnings for us in a future process setup.

Thank you both.

Thank you. And we'll take our last question from Rich Greenfield from LightShed Partners. Your line is open.

Hi. Thanks for taking the question. I'd just love, David, kind of from a high level, when you think about the virtual MVPDs, I think you all did a great job of getting on to these platforms and sort of using the crowbar of the Scripps acquisition to kind of push your way into a lot of these packages. We saw Hulu last night, on the live side, their growth has really slowed dramatically. I think they had added 100,000 subscribers in the first quarter. Is the VMVPD like – what do you think is going on there? Like, you would have thought with a click of a button, you could add TV during the pandemic while everyone is stuck at home and you certainly didn't see that in Hulu live. What's going on with that part of the business? And is there anything that they can do in your mind to re-accelerate growth?

I think it's simple. They're charging an awful lot of money. You can get a package of multi-channel television for $10 or $20, sometimes less than $10 everywhere in the world. And if you took sports out, we could do that very easily. And so, I think they're saddled with regional sports networks, saddled with overstuffed re-trends and sports channels, and that's an issue in general.When you look at that price now and you're not getting any sports, I'm not surprised. We're not seeing that outside the US. The sub levels are up around the world. So, people are spending more time. They're obviously spending a lot more time with our content.I think there should be a rationalization of the market. And some of the stuff should just get puked out. Enough. And I think, particularly in a moment where we're in a recession and people are really watching every dollar, and you put up a TV set and people waiting in lines to get things, and yet add up what they're paying for sports that they're not getting. And then, you wonder why aren't more people waiting in line for that? It makes no sense. You've got to puke out that stuff and you've got to go to the players in the marketplace that are stuffing that in and saying not now. Back off. Not now.The thing that's good for us is we're in every single packages, all of them. And one of the things that I think will help us is these things are going to fluctuate. Everyone hasn't reported yet. We'll see how Charlie does. I think in the long run, we don't know how long this is going to last. We're seeing real growth with some of the smaller package players as I mentioned. So, we'll see…

I'm just been surprised how much they've been pushing price rather than rethinking packaging.

Look, ultimately, the distributors are very, very smart and their job is to serve their existing customers and to keep the customers happy. So, I've always said, eventually, this will get rationalized. But, ultimately – it's way too soon to draw a conclusion. There have been quarters where it looks like we're not losing subs anymore in the US. Then there's quarters where it looks like, oh, no, we're losing a lot of subs. And in the end, we'll see where it ends up. I believe that if we could offer some cheaper packages, we'll do extremely well. But I don't see anything in the marketplace that makes me feel like, well – so we'll see what happens.

Thank you.

Okay. Thanks, everyone.

And that does conclude our question-and-answer session for today's conference. Ladies and gentlemen, this does conclude today's call. Thank you for participating. You may now disconnect. Everyone, have a great day.