John Hudlick

John Hudlick asked about AT&T's positioning for potentially higher wireless promotional activity in Q4, the behavior of customer cohorts nearing the end of device financing, and whether ARPU pressure in both wireless and broadband is expected to continue.

Answer

Chairman and CEO John Stankey stated AT&T is well-positioned for a competitive market, focusing on converged customers to drive down churn and increase lifetime values. He described ARPU trends as a "feature, not a bug," reflecting strategic targeting of underpenetrated segments and value-driven convergence. CFO Pascal Desroches added that while ARPU may be impacted by targeting new segments, the focus is on maximizing service revenue, with pricing actions expected to contribute to growth.

John Hudlick asked about the potential impact of Sora 2 and other new AI content creation apps, specifically concerning increased competition from short-form video and engagement.

Answer

Co-CEO Ted Sarandos suggested that AI content creation apps are likely to impact user-generated content (UGC) creators most in the near term, potentially replacing existing UGC viewing. He emphasized that creating great shows and films still requires great artists, and AI serves as a tool to enhance creativity rather than replace it. He drew a parallel to AI-generated music, which remains a small part of total listening, with established artists still thriving. He expressed confidence that AI will help creators tell stories better, faster, and in new ways.

John Hudlick asked about the potential impact of Sora 2 and other new AI content creation apps, specifically regarding increased competition from short-form video and engagement.

Answer

Co-CEO Ted Sarandos believes AI content creation apps will likely impact UGC creators most in the near term, replacing existing user-generated content. For Netflix, he emphasized that great storytelling requires great artists, and AI can provide tools to enhance the experience but doesn't automatically make one a great storyteller. He drew a parallel to AI-generated music, which has been around for a long time but remains a small part of total listening, with established artists still dominant. Sarandos is confident AI will help creators tell stories better, faster, and in new ways, and Netflix is 'all in' on that, investing in value for creators and members, not chasing novelty. He is not worried about AI replacing creativity but excited about AI creating tools to help creativity.