Doug Arthur: Got two questions. Meredith, the deal with Apple News Plus that started late in the fourth quarter. Did you get any read-through at all? Or is it on the impact? Or is it just too early? And what kind of are your expectations there?
Meredith Kopit Levien: Great question. Tiny impact, I think I’m looking at Will and Anthony, if they want to characterize that anymore, but tiny impact, just based on the timing and then, obviously, bigger impact to come. And the — there are a handful of things we’re particularly excited about in this deal. One is as we’ve talked about with you and others, we are very, very focused on building audience and brand awareness and use of the Athletic, and we see Apple News Plus is a great way to do that. Apple is doing a lot of interesting things in sports, really good partner for us there. And the Times has very, very big ambitions for the athletic in sports, and we see this as helping us achieve that. So it’s good in any number of ways and you’ll — you can expect to see the impact on a go-forward basis.
Anthony DiClemente: Doug, did you have another question or you offset?
Doug Arthur: Well, I just — I didn’t want to beat a dead horse, but it seems like your digital advertising outlook for Q1, is I wouldn’t call it optimistic, but it’s more constructive, I think, than what we just witnessed in the fourth quarter is, I guess, just trying to measure your conviction level on that?
Meredith Kopit Levien: Yes. Well, let me preface it by saying its hard — advertising is hard to call. We don’t have a ton of visibility, but I’ll say a few things. We did in digital in the fourth quarter, a fair amount of what I would describe as marketer news avoidance. You have the war between Israel and Hamas break out in early October. And that that had an effect in both display and audio. And at the same time, what you see us doing to lap up some of the demand to work with the times and we’re doing this anyway we are extending our ad products very aggressively to other parts of the portfolio beyond news. The Athletic and Games have been real bright spots so far, and we see a lot of running room in both of those places and potentially in Cooking and Wirecutter as well.
So I would say we are — we’re long on news over a medium and long-term time horizon. We also have a lot of other places to kind of lap up interest in working with the Times for marketers. And the core of the business, Doug, which is those premium at canvases and first-party data continues to be resilient.
Operator: Our next question comes from Vasily Karasyov from Cannonball Research.
Vasily Karasyov: Meredith, so do I understand correctly that when you say in your prepared remarks that the headwinds in the advertising market that carry into this year 2024. You mentioned the current events, the Middle Eastern situation and so on, they just advertisers not wanting to advertise next to the content that’s driven by current events? Or is there something more structural because you also mentioned publisher volatility. And I was wondering if you could explain a little more what the TAM means?
Meredith Kopit Levien: Yes. Listen, I think it was a volatile ad market that tends to hit publishers hard when it happens. We have a lot of, what I’m going to call, structural confidence in the core of our ad business. Premium campuses and first-party data and core New York Times are now extending out to our other products with a lot of running room is really working. So that’s the message I want to convey and I think I answered the other part of your question before. To the extent you’re asking how do we think about publishers relative to platforms or any other business that are in the ad business in a big way, I would say marketers use publishers, they tend to differently than they use the big platforms. One of the things we — that gives us a lot of confidence is while we tend to get more middle and upper funnel advertising, meaning sort of not direct response, more brand in most parts of our portfolio.
Our ads because of the way we sequence ads and the first-party data, our ads are really perforant. And what you’re watching us do is extend those ads across more parts of the platform. And I would say there, we just have — it’s early days on Athletic and Games and potentially Cooking, Wirecutter, and we think we’ve got a lot of running room. I’m actually going to use that as a segue to mention an experiment. We’re also — I’ll go back to the question Thomas asked about at the top of the call, and I’ll talk about ads here, too, related to your question, and it’s about AI. We have been using AI in our ad business sort of the whole way through with first-party data, and I think generative AI presents the opportunity for us to get even better at that.
So you can assume we’re beginning to experiment with generative AI in our ad products, at least as far as improving our ability to do contextual targeting at scale. And I think that just goes to sort of structural — our confidence in the underlying structure of our ad business. And I’ll just mention, again, going back to Thomas’ question and the other question I got about generative. We are actively experimenting now, and you’re going to see us do more and more of that with generative AI kind of across the product set. So I’ll mention — in the fourth quarter, we put out an experiment relatively small, early days, but exciting in augmenting Spanish language translation for our content, which we’re excited about, and you can imagine the implications of being able to do that at scale.
Again, it’s very early days. And we expect to get another experiment out into the market, probably this quarter around synthetic voice, which would help us give people the ability to listen to a lot of the written New York Times. So that’s in addition to using AI and beginning to use generative AI in how we target advertising.
Operator: And ladies and gentlemen, with that, we’ll be concluding today’s question-and-answer session. I’d like to turn the floor back over to Anthony DiClemente for any closing remarks.
Anthony DiClemente: That’s it. Thank you all for joining us this morning, and we very much look forward to talking to you again next quarter. Take care.
Operator: And ladies and gentlemen, with that, the conference has concluded. We thank you for attending today’s presentation. You may now disconnect your lines.
