All right. Good afternoon. I'm Jason Bazinet, Citi's media and entertainment analyst. I'm very pleased to have David Gandler and John Janedis of FuboTV, CEO and CFO, respectively. I should have said that. Welcome, gentlemen.
Welcome. Thank you.
Yeah.
Thanks for having us.
Absolutely. I've got some questions I'm gonna ask. If anyone in the audience wants to ask a question, just please make sure you hit the button just below the red arrow so your question will go over the Internet. Otherwise, it will be a one-sided conversation and a weird transcript. I just wanted to start with, like, a real simple question in terms of competition. I mean, if I'm a consumer, you know, what would you describe as the set of attributes that would cause a consumer to say, "I'm picking FuboTV," over something else that might be out there in the marketplace?
Honestly, It's actually a very good question, one I think that can be answered sort of in three buckets. One is on brand. We have positioned ourselves many years ago as a leading sports platform.
Mm-hmm.
We have 50,000 sporting events on Fubo. On the second bucket, I would say it's product differentiation. We were first to market with, you know, capabilities like 4K. We're the only service that has a perpetual DVR, so you can save your famous moments from, you know, World Cup of past or, you know, Super Bowls, etc . We have features like MultiView, which is one of the most talked about features. On the content side, you know, we also differentiate with. We just recently announced our deal with Sinclair. We have, I believe, the largest or the greatest number of local sports networks in the market. Those are sort of the three vectors, I think, in which we truly differentiate.
All of this is supported by our, you know, the recognition we receive from J.D. Power with the highest customer satisfaction. Product, technology, and brand, in short.
When you say local sports, we should think RSN.
Regional sports, correct.
Okay. Got it. Perfect. That's great. Then how do you see Fubo's role sort of changing over time? Is it just a function of these attributes that differentiate you and sort of getting that to resonate with the consumer and sort of taking share? Are there other sort of bells and whistles or attributes that you see unfurling...
Yeah.
over the next two, three years?
I think most people don't recognize the value of our technology stack. I mean, we are truly a product and technology company first. We don't just deliver, you know, a video to you and collect your money and call it a day. I mean, I've mentioned some of the capabilities we focused on. We have a proprietary technology stack. We are very focused on artificial intelligence. We are releasing a 3.0 version of Fubo that will be tested first in France at Molotov, which is a very similar service to Fubo in the French market. I think over time, we're gonna continue to be a sports-first cable TV replacement service. That is what we are. We aggregate content. I think that, you know, aggregation is probably the key to success in the media landscape.
We're going back to where we started. It's become clear that churn levels among, you know, plus services are continuing to increase. People are starting to deal with switching fatigue, you know, inability to discover content. You know, I believe that young companies are around to solve real problems.
Right.
This is a problem that I think we'll be solving in the streaming space. That's sort of our positioning. Then beyond that, I would say the type of platform we're building will really allow us to scale out globally in markets where you have a lot of local media companies that aren't able to derive value from the streaming side in the same way that we think we've provided significant value in terms of revenues for our media partners.
Do you see sort of, you know, I think you can correct me if I'm wrong, David. Verizon was talking about its role in terms of sort of bundling, you know, mobile services with these apps and sort of presenting sort of that wireless offering with sort of just whatever it is, you know, Netflix or whatever. Is there a role for Fubo there to sort of take your sort of digital linear experience and augment it with apps in a way that can play a role?
Well, that, I think, is probably the most important piece of what we do.
Okay.
We are spending an enormous amount of energy getting people to stay on the platform for 100 hours. If you think of Netflix as sort of the gold standard, you know, I bet that people are spending maybe 30, 40, 50 hours a month on Netflix. At 100 hours and 2 billion-plus data points that we collect, our ability to run hundreds of A/B tests simultaneously.
Right.
All of these things allow us to better understand our customers, and to offer services. One of the things, I would say the most valuable pieces of why the platform is so valuable is that you're actually amortizing the costs, your acquisition costs, when you're able to add more services.
Okay.
I think what you're saying is extremely true. Obviously, that starts with adding first content. We attempted to do this. I'm sure there'll be a question around this.
Yeah
... side as well. I do anticipate that there'll be opportunities for us to add advertising, for instance, capabilities such as, you know, if you're watching an ad for, Buffalo Wild Wings, for instance.
Yeah.
You'd be able to order online given all the information that we collect. There could be some, you know, I would say commerce point, there could be more content that we're offering on an à la carte basis. There could be other services, you know, that we can run on the back end as well, just given the amount of value that we're creating. Certainly likely scenario.
That's cool. Maybe I can dig into just the advertising opportunity itself. I mean, I think there's sort of a well-understood sort of split between what the content provider would get in terms of ad inventory and what the traditional cable satellite telco provider would get in terms of inventory. If I remember, and John, you can correct me if I'm wrong, it always seemed like the ability of the distributor to sort of monetize the advertising was already always sort of impinged a bit because either there weren't enough local advertisers to fill up that demand or they couldn't stitch together enough, you know, they couldn't aggregate all that local stuff to sell a national spot. How does advertising sort of, and that opportunity fit into your overall strategy?
Why don't you set the stage?
Yeah. Yeah.
Setting the stage. I mean, I've been in media my whole life, and so I have worked in everything from, you know, local broadcast television, local cable. I'll tell you some very interesting differences between what we do and what the old cable model is. One is, you may be aware that cable companies had headends where they would carry. I think you can only advertise at the time that I was doing this was on 40 networks. There was a limited amount of inventory that you can actually insert into. Now that barrier is gone. We can have an infinite number of networks, which as you'll see from most recent news, we're continuing to add more channels.
Mm-hmm.
Two reasons why we're doing that. One is.
Sorry, just to ask, do you mean free ad-supported?
Free ad-supported count to television channels, right? One is because we have infinite capacity.
Mm-hmm.
We can actually monetize every available second. That's a very important component of why we think we can, you know, take our advertising revenue per user ad ARPU to let's call it $15 plus, right? Again, looking back at the cable industry, you know, they seem to have averaged in the $8-$10 range.
Yeah.
With real significant limitations. One is the number of headends becomes infinite. The addressability, those capabilities, allow us to actually drive higher CPMs. The fact that, you know, we can actually sell it, these are one-to-one ads, right? Versus just a broadcast ad.
Yep.
You know, there's a greater pool of advertisers that we can talk to. I think the most interesting component of sort of advertising moving forward is that the local advertising, you know, base, if you will, or the regional base, is now getting access to self-serve platforms, so they can also participate in programmatic, which we have yet to see. All of this allow us to really tap into as, you know, call it as a cable replacement service, more networks, more capabilities, infinite number of fast channels if we, if that's something that we choose to do, and a more inclusive, you know, base because they have more access to technology. From my perspective, this makes it really, and the last piece is because we're so heavy on sports, so you see higher CPMs.
Yeah. I would add a couple things to that. One would be just simply in terms of our ad stack and our sales team, and I would say 2022 or last year was a year of heavy investment in both the team and also in terms of our ad capabilities. To David's point, we have been historically a heavily programmatic business. We have invested in a lot of sales force people in terms of sales team. We've doubled the size of our sales team. The CPM from direct sales relative to programmatic is materially higher, so there should be a CPM tailwind from that.
Yep.
As it relates to the CPMs more broadly, I think that we're priced well in the marketplace. We've historically said we're calling the low-ish twenties. On a rolled up basis, I think there's an opportunity to take the tail higher, which then pushes the overall CPM for the overall platform higher.
Tail meaning the low end.
The low, yeah, exactly. Yeah. I would also add in terms of to your comment before around the fill rate. I think we've been doing a lot of work on fill and fill has, I'd say we're not always fully sold out, but I'd say the fill rate has been improving over the course of the year, and we think that has legs to it as well.
The fill rate's improving because of those sales force investments that you've made or?
Yeah, I think it's a combination of things. David spends more time on it, so let him.
I would say, I mean we said this publicly, I think at first quarter of last year, is that we needed to make more investment and greater investments into the technology, the ad technology side. We said that those investments would pay off in the back half of the year. Again, just going through our earnings Q3 numbers, you know, you'll see that that is exactly what's transpired. I believe, you know, John provided commentary around what we were seeing during our earnings call in terms of fourth quarter numbers, and we felt really comfortable that we were able to continue down that path of strong revenue into the fourth quarter, despite all the uncertainty that everyone else has been talking about.
Right.
I think the investment in technology and sales force. I'll just add one thing to what John said about sales force. Yes, we've doubled our sales force, but again, coming back from cable, I can tell you it's not hundreds of people. We're talking about tens of people. It won't have a material impact on our cost structure.
Okay, that's great.
That's right. To David's point on that front, you know, we're highly focused on the cost side from the sales resource perspective. That is a largely, commission-based-
Right.
model as opposed to adding fixed cost.
Right. That $15 number per user per month in advertising, that's sort of an aspirational long-term goal or is that something?
I come from the ad business, I don't like to say it's aspirational. I think it's a doable number. you know, obviously this is a longer-term number. I think if you back into where we are, we're sub 10.
Okay.
Well ahead of kinda where we were just two years back.
Okay. That's great.
Again, just the reason why I provided you the backdrop of where cable faltered is because that should give you a baseline for what the ad revenue per user was in a platform that has significant limitations.
Got it. Makes sense. A couple of the other management teams that have come through here and talked about it, they sort of say, you know, "Gee, everyone's been talking about this recession since March of 2022, outside of digital media, we haven't really seen so far a lot of real disappointing ad numbers." Everyone on the buy side is just waiting for when the shoe is gonna drop. Do you guys have a view, either a macroeconomic view or things that you're seeing on the ground that would make you either more or less cautious?
I don't know that, I have necessarily a pure macro view. I mean, I read a lot of the same things that you-
Yeah
... and your clients read. Look, when I talk to our sales team around, call it, the macro that is affecting us, what I hear is that, you know, the marketplace is for the most part hanging in there. Look, to David's comment earlier, I think that maybe we're a little bit positioned differently, right? Meaning, you know, mostly live, you know, 90% plus live. 96% or so of our subscribers are sports enthusiasts. As you know, that tends to hold them better when things are softening up a little bit or there's macro concern.
Yeah.
We also have a heavy news viewership, which I think has also been holding in better. I'd also say, adding back to my comment before, you know, having a little bit more in terms of direct sales has also buffered us, I think-
Yeah
... to maybe some of the macro headlines that we've seen out there. You know, to my comment on the third quarter call, what I said at the time was that we saw sequential improvement in our year-over-year ad growth from July to August to September. I think what I said was that we continue to expect solid growth, double-digit growth in the fourth quarter. I think I don't have the all the numbers yet, given that it just wrapped up, but I think we felt pretty good through earnings that the fourth quarter was shaping up well. You know, have I asked about, say, cancellations among other things, just to see what things feel like?
I would tell you that from a cancellation perspective, we're really not seeing much, maybe like one or two related to supply chain as opposed to background.
Oh, all right. That's good. Can I ask some clarifying questions on that 90% of your viewing hours are live? Is there a way to frame that either in terms of what you think, you know, live viewing is for someone that has a traditional cable package or telco package today? What is... I'll just start there. Like, do you guys feel like you're massively over-indexing at 90%? Or if I just had a Charter subscription-
Well, I mean
... or an AT&T subscription, they tell me it's nine.
No, I think my opening comment, I said we're a cable replacement service.
Okay.
There's a value for this type of service. I think if you were a cable customer and you're looking for a similar experience, you have channels that you enjoy, whether it's ESPN or, you know, Fox News…
Yeah
... or whatever it is that you watch. I think that's the type of service that people are looking for from us. You know, Netflix obviously it's binge viewing.
Right.
You're gonna see that. On the ad side, I just wanted to also clarify, you know, demographically speaking, you know, we skew younger than any virtual MVPD.
Really?
Yes. We are sort of, I would say, core user is 18 to 49, but we skew closer to sort of that 40, 41 years old. That's a very important demographic skewing male. Just again, just to, you know, highlight the sports component of this. That's probably the hardest to reach demographic.
Right.
I think that we have some control over our destiny. There are lots of categories that are looking for this particular demo within premium programming. The fact that it's on a connected TV makes it that much more valuable. I think on the shoe dropping side, I think what you're going to see in 2023 is, of course, there's uncertainty for all of us, depending on how shallow or severe, you know, the recession's going to be. It is a self-fulfilling prophecy that when you're a marketer and you see all this bad news, you quickly think, "Okay, I should probably pull back." I would argue that marketers are going to pull back. They're not gonna pull out.
As they pull back, I think the requirement is gonna be, how do I measure attribution? At the end of the day, the publishers or the media companies, whoever can actually demonstrate that this is working-
Right
... within the modeling characteristics that, you know, a lot of the CPGs or autos have, those will continue to have some budget. I think you'll probably be last to get cut-
Yep
... if you will, and I think the numbers, around most recently, discussed around, you know, Meta and Google losing their 50%+ market share should also give, others comfort that there's actually a way to continue to drive, you know, some share.
Yeah.
Right? I think that's a really important component because advertisers are seeing there's probably more value outside of those two companies and, you know, they've been earning more than their fair share and have been charging more.
Right.
I think this actually is a good thing, you know, for the industry.
Makes sense.
The only thing I would add to David's point, just going back to the demo for a second, and differentiating and attractiveness back to the mail piece. Just for reference, I think from the data we look at, call it the peer or competitive set is about 10 years older in terms of demo.
Ten years older. Okay, that's great. You talked about your sport-centric customer base, which makes perfect sense. I'd love to just go back to sort of I understand the logic of Fubo Gaming, but I'd love to just go back to sort of what was it that caused you to sort of retrench from that aspiration to sort of get more involved in the online sports betting?
Let me start with why we went into it.
Okay.
Look, the thesis is strong, and it's to your question about or to your point around Verizon, which is offering more services to people within a specific cohort makes a lot of sense because you can now amortize the acquisition cost.
Right.
Right. It's like the way I think about it is if you're an Uber customer, you no longer have to acquire a customer for Uber Eats, right? They have the app downloaded, makes complete sense. Because we're spending, you know, upwards of, you know, what we like to say is one to 1.5 times monthly ARPU, you know, that's a decent number for us to acquire a customer with. We want to be able to maximize that. That was the genesis of why we should do this. The sports-centric audience, the amount of video content we have, the increasing subscriber base that we had, all made sense.
When you couple that with a macro environment that was conducive to, you know, finding efficient capital, at no cost, actually, free capital, then this made a lot of sense. You know, the risk reward seemed to be where we want it to be.
Right.
Fast-forward 18 months later, 'cause it takes time to sort of build out a lot of this, get the licensing done, you have a rate environment that is completely flipped. You know, I like to talk about it from consumer perspective. I remember rates 18 months ago were in the, call it two, two and a half range on a 30-year fixed, you know, maybe just below three. When we decided to pull, you know, we saw rates that were, I believe, either just shy of seven or just north of seven-
Right.
... Percent. You know, that and being a public company where everyone's focused on cash flow and profitability just didn't seem like the appropriate thing to do, given our fiduciary responsibility to hundreds of thousands of shareholders. That was really the decision. We were able to launch our service in New Jersey, which was a bigger market. The two other markets were so tiny, it's really about trying to tweak the tech.
Yep.
We have built up some strong technology in the ability to sort of combine those two, the intersection of gaming and video. We did see directionally what we were expecting to see. Typically, when you're a smaller company or a startup, you start to sort of tweak until you start to see the types of KPIs you're looking for. We were just there. We had just launched. We had about seven days of data maybe. It was pretty much what we wanted to see. Unfortunately, you know, the macro is the macro.
Yep.
You just don't have the same luxury you would as a private company. I do believe that what we already know and what we've already developed, I think there's an opportunity to continue to sort of play in that space, albeit not directly. You know, we can partner with other players in the space that are looking to access, you know, a subscriber base that is, you know, 100% into sports.
Yeah.
Right? I think that there will be time when we can do that. Right now, you know, we're in sort of conversations with different players, but as I think their marketing costs continue to increase and it's harder to reach users, I think, you know, they'll come to us. We're in no rush right now to do anything, but I do feel that we will take advantage of that space in due time because we own all of the proprietary technology, and which for me has always been the reason why Fubo was so valuable is 'cause we built up all the tech.
Right.
We are able to sort of control our own destinies and develop capabilities that we think will create value for shareholders, partners, and customers, of course.
You're totally right that the OSBs are grappling with their own free cash burn, you know.
Yeah.
trying to drive their CAC costs down, talking about moving more to national ads, you know, to try and get their cost of acquisition lower so.
Yeah, but on a platform like ours, I mean, think about it. Just kinda look at the calendar of sporting events. You have college football championships early January, so people are betting on that. You have the Super Bowl. You have to go out and remind everyone, "Hey, don't forget to place your bets." Right? You have March Madness.
Mm-hmm.
Another three-week run where you have to remind people to go place a bet. Most customers, based on our research, have three to four OSB apps, and, you know, they're playing off the different promos. You can on one bet against team A and on the other one bet against team B, and you always come home with a win.
Right.
It's actually quite interesting. For those that understand how the promos work, you're always making money.
Right.
You know, for me, when you integrate betting, you don't actually have to go out and constantly remind people to place a bet. They're already in the environment. They're in the mind frame. You know, they are either for team A or for team B, and you can actually start to leverage the casual bettor, right? Which is really, I think, the entertainment value that I thought we were gonna be creating by continuing down this path.
Yeah.
There was some retentive value as well in that.
Makes sense.
But it's an interesting time.
Are there any sort of cost savings you've called out by sort of shutting down Fubo Gaming?
Not directly. You know, when we had our investor day back in August, we had already announced that that business was under review. When we gave out our targets out to 2025, call it, we had excluded the gaming piece of that.
Okay.
-because it was unclear where that was going to land. Were we going to retain it? Were we not going to retain it? The short answer is that it's in our model in terms of the savings were already there.
Okay. All right.
Yeah, they are not insignificant.
That's great. In terms of your 2025 targets, you guys pointed to expanding your ARPU from about, what was it, $73 in 2021? Was it $95? I think I have that right, by 2025.
Mm-hmm.
What would you sort of give investors as sort of the bullet points underneath that delta between 71 and 95 that's gonna allow you to get there?
There are a couple things I'll start with. Maybe David will fill in some blanks here. Right. You know, over time, we just talked about call the Ad ARPU piece, we think there will be several dollars of Ad ARPU increase. Call it, you know, $5-$10 of Ad ARPU over the next three years that we expect to be able to take it out of the marketplace. The second thing is we continue to believe that we have pricing power. You know, we get questions every now and again around do we have pricing power given the competitive set. You know, our most recent price up was earlier in the spring.
We priced up $5 for our lowest end package, and I would tell you that the churn that's off of that was below expectation.
Hmm.
On top of that, you know, was there a tail to potential churn off of a price increase? We've also said that in the third quarter, we had our lowest churn in the history of the company.
Hmm.
We think there'll be a combination as a result of that combination of price increase, Ad ARPU. Also we've done a lot of testing, and David mentioned A/B testing. We do a lot of testing around our different packages, right? We have call it three packages, our Pro, Elite and Ultimate. What we've been doing is pre-selecting these premium or higher end packages, and we've also seen a good take rate on those. That also kind of layers in on top of that, an upward pressure organically, if you will, in terms of new subscribers. I think somewhere in the range of around, I think we said a few months ago, most recently, about almost half of our new subscribers are coming in at these premium plans. That'll also be a tailwind.
We have also attachments, whether it be, say, some of these premium services that are owned by some of the conglomerates. Those also add to the ARPU.
Half your new subs coming under these premium plans. Why? That seems so counterintuitive given, I don't know, all the inflation duress and.
Well, yes and no.
Okay.
I think the two things I was gonna add, which probably align with your question, is the nature of our program. We are heavy sports-oriented. When I think about pricing, I think about it on a relative basis. You know, if you think about who's left in the cable sort of ecosystem, it's people who love sports, right? If you think about other virtual MVPDs or other streaming services, there is a price ceiling because more than half of their customers are general entertainment customers.
Right.
The reason why people left cable was 'cause they didn't wanna pay. They felt that sports was causing the increases, and so they wanted to leave.
Right.
You know, here we are with Netflix today.
Right.
In our situation, almost 100% of our base watches sports.
Right.
We've actually raised prices from, I think it was $6.99 back in 2015 to now upwards of, you know, $65, right, on the, on the base side. That's one. I think that on a relative basis we have more pricing power because, again, as we add more content, our customers are saying, "Wow, he's giving us more," or, "They're giving us more sports for our money." We like that. The other thing is having everything in one place, you're reducing the switching fatigue. People can't find content. Amazon Thursday Night Football, I think is the, I would say, the perfect example of why we belong in this industry. I can get into that in a second.
The second thing is that I remember, you know, when we started raising prices in like 2017, 2018, I remember people saying, "You know what? I'm going back to cable." Because they were like, "What? If I'm going to pay more, I might as well go back." The reality is, I was thinking about it over the, over the break. If we had pricing parity, not saying we ever will, but I'm just saying in a theoretical scenario, if we were $120, not Fubo, but a virtual MVPD was $120, would you ever say, "I'm going back to cable?
No.
That is the question that I had. The answer is no. I do believe there is some pricing power there. I do believe because we're sports-oriented, we have more pricing power. The third thing is the Amazon point that I want to people that are or I would say investors that are, you know, give Amazon the benefit of the doubt, they'll say, "Well, you know, the schedule was weak." Yes and no, the schedule was weak. If you look at the local ratings for those same games, yes, there were several games, I think several weeks, where the ratings came in, but they immediately bounced back. We didn't see that bounce back.
I believe that there's something called switching fatigue, where at some point in time, the cognitive load required to go into another app, to go set that up, to then wait till there's a commercial, to have to bounce back out, almost negates the value of actually going in. There has to be, you know, an aggregated version of something like a cable bundle in the streaming world that has greater data, greater discovery. You know, from my perspective, I think that the ability to go from 70 to 90 plus, you know, as John stated, I think is doable just given from, you know, some of the things that we're seeing on our end.
Yeah.
Yeah, sure.
Just hit the button if you don't mind. Yep, you got it.
Am I on now?
You're on. That's good.
All righty. I'm excited. One thing just to comment on, just your last comment on Amazon. I'll take the other side, which is, I think part of the reason why Amazon has Thursday Night Football is to drive Prime subs. I don't think they care about sports. I don't think they care about streaming. I think they care about getting people into Prime because they find that a Prime user is incredibly valuable purchasing, you know, paper towels and whatever. I think that's
Yeah.
The motivation may be different. You know, same reason why they spent, I don't know, $1 billion for The Lord of the Rings or whatever. Like, I think they just wanna drive Prime subs. That said, you now have Google throwing their hat in the ring that they wanna go after sports. I guess I have a bunch of questions, but my main one is, when you think about the value of that sports franchise, it's incredibly insightful the way you said Netflix was created because there's a lot of people who don't want sports but want cable. That's very insightful. First question is, now that Netflix, and I'll throw Apple into this as well, now that Netflix and Apple have those huge installed bases that don't have sports, why won't they either why don't you combine with them or-
Yeah.
Like, why won't they become a challenge?
Yeah.
Let's start with that one.
First of all, I will agree with you partially on the Amazon piece. I would say on the latter point where they don't care about sports. That I will agree with you on. Where I challenge you, and I will challenge anybody here, or on the phone, is you tell me the last time you met a person that said, "Hey, I'm getting Amazon Prime because they have the Thursday night game." Most people already have Amazon Prime, and if you ask anyone, I'm sure if you survey anyone, why do you have Amazon Prime? They'll say it's the delivery. I'm not sure that, you know, Thursday Night Football is driving anything. If you were to say to me if it was a market like India or something, yes, I believe that that is actually possible.
In the United States, there is no reason that that game is there. One of the things I said in an earlier meeting is, you know, why do people invest in startups and how do VCs think about startups? You know, really one reason, is there a need in the market for what you're doing? I would argue there is no need in the market for a one-night game, that, you know, is out of right field, on an app where people don't really care. Hence maybe the reason, I don't wanna turn this into an Amazon call, but, you know, maybe that's the reason for the sports app. Then on the second point you made on Netflix, and Apple. Well, I'll start with Netflix. Netflix.
We said, the reason why Netflix exists is because people didn't wanna pay higher prices for sports. I think Reed Hastings has said, "I'm not sure what we can do for sports." Now, you know, I take that with a grain of salt because he also said, "I'll never see advertising, you know, in our, in our service." We have it today. My sense is it's in a very expensive game. To your point is that if it's that expensive and no one cares about it, and they're all overpaying for it, then, you know, I don't think that's Netflix business. Also I think they're doing quite well as it is relative to every other Plus service. I'm not sure that this is a necessity for them. Of course, they're gonna dabble, look at it.
I mean, I would argue that you should always be looking at everything in terms of video if you're in the space. In terms of Apple, you know, I go back to my points on Amazon. I mean, they're an ecosystem. They want it. The question is, will you sell the 150 million and 1 device because you have sports? I think they can extract positive economics, you know, any way they want without actually having ownership. Not sure there's any value that's being created. Look, everyone is looking for ways to differentiate today, and I think all of this is actually good news for us because the more fragmented things are, the more likely it is that people will say, again, I go to my switching fatigue point, is that, "You know what?
I get 80% of the content in this one place. I love the MultiView, love the FanView, love the 4K, love the discovery, love the perpetual DVR, you know, love the apps. I'm in," and that's it. I think we're getting to a point in time where, you know, the conversation around sports moving to streaming, we were just saying it earlier. It's being streamed. It has been streamed since 2015. You know, it's not like sports is going to streaming. Wow. It's really a case of like, where is it most suited and most valuable? On the last point you made, why don't you combine with, you know, some of these guys? You know, obviously that's not something that we talk about.
I think we can be a very strong player, independently over the next few years because I think the market is actually coming in our direction. There's been a lot of uncertainty, and you've seen a lot of changes in media over the last 18 months. As you said, you know, YouTube picking up this, peripheral, NFL package. You've seen other moves by other players and combining different, you know, media assets into one and, you know, pricing promos at $1.99, advertising and Netflix. All of these things are happening relatively quickly. I think ultimately we're gonna go back to where we started, which was like, I make money on the bundle, customers are happy, shareholders are happy. I'll leave you with this comment. COVID helped companies like Peloton and Fubo and Netflix drive subs.
I will say that the recession will help us in rationalizing our cost structure and helping our counterparties rationalize their businesses, which obviously, you know, the Plus world doesn't make a lot of sense for reasons we all know. High churn, low prices, maximum output, hit rates that are below 7% for TV shows, and just the marketing costs of having to market every single program, it's just, it's insane. I think that, you know, our goal is we have a 2025 outlook, that John presented, and our goal is to sort of stay within that. Obviously, there'll be some noise, quarter to quarter, but I think over the long term, we think we're, again, positioned well relative to where everybody else is.
Yeah.
The type of platform we have, which is, you know, platform agnostic and completely software driven.
One final question. Of all of the 2025 goals that you guys have articulated, am I right that the street cares most about free cash flow breakeven?
That's probably fair.
Okay.
I think ultimately, to David's comment earlier, you know, we all have talked about, you know, you've written about this just in general around the cost of capital...
Yeah.
You know, need for funding, right? ultimately, I think for us, you know, getting to that point of self-funding in 2025.
Yep.
I think is really important. You know, to David's point, I think we feel pretty good about being able to get there.
That's great. Well, you guys are on an interesting journey, so I wish you all the best of luck.
Interesting to say the least.
All right. Very good.
Thanks for having us.
Yeah.
Thanks. Thank you.
Thank you, David. Thank you, John.