Thank you everyone for attending, and delighted to welcome Charlie Bracken, Liberty Global CFO. We've also got Mike Bishop from IR with us today. Thank you. You've got your breath back? Yeah, I'm good. No more chasing. Well, my mistake was I went by taxi. I should have gone by tube, shouldn't I? Yeah. Swiss cars. It's, the weather's not been friendly to anyone today. I'm gonna start a little high level because I feel like we actually spoke on this stage a couple of years back. Mm. It felt like the strategy at the time was reasonably clear. You had these regional champions, I think, was the definition. The idea was always potentially to realize value at the re-regional champion level, whether that might be an IPO or any kind of asset sale. It feels like that strategy has changed. Mm. Is that fair to say, or? No, I don't think that is fair to say. Let me, you know, look, I think probably like all of us here, we're a bit frustrated by the telecoms industry. We are, in our mind, at least suffering from a holding company discount, probably to do with complexity, which I think I can understand, joint ventures, et cetera, et cetera. Also a portfolio that is really hard to position in one equity story. You know, clearly, we acknowledge that, and we've been taking advantage of it by buying back our stock very aggressively. We continue to buy our stock very, very aggressively to lock in that discount for some of the parts. You know, ultimately closing the gap, I think probably does require some simplification. You know, is now the right time to do simplification? We're in the middle of an investment cycle. I'm sure we'll get into that. Mm-hmm. We've had a listing that probably wasn't working as well as it should do with this minority stakes in the case of Telenet. The long-term strategy, I think, still remains to look to ways to simplify and rationalize the equity story. As a, as a management team, and I think we've hopefully demonstrated this, though it has been five tough years, at least for us and the sector as a whole, you know, we're not interested in empires. We're interested in creating value and getting that value priced. Mm-hmm. It seems to us that having the flexibility to consider, you know, spins, IPOs, trackers, listing, God knows what. Mm. Has to be in our toolkit to think about that. Okay, let me challenge that. Yeah. I would put it to you that maybe the flexibility has reduced a little, and that's a function of two things. The first being that I think the migration from cable to. Mm-hmm ... or the growth of fiber, has probably been a little bit faster than we might have thought. There is a sense that in some markets, you're maybe a little more under pressure. Mm. to migrate the cable infrastructure. I would certainly put it to you that I think cable is not the solution long term. We can come back to that one. Mm. I suspect that might be a debate. There is that dynamic working, where arguably there is a call on cash to start migrating that cable over to fiber. Secondly, the cash is more expensive, and you're coming into the equation with relatively high leverage... Yeah which has been an extremely successful strategy in the past, but we're in a different place now. I think there's a lot to unpick there. Look, I agree, I mean, again, this is why I think you have to look at it on a country-by-country basis. Yep. If I can, I'm gonna just focus. We've got 5 big countries. Remember, we've sold broadly half the company, used the proceeds to buy back the stock we had cheap. If you look at our countries, I would say that the network strategy varies. Mm country by country. In the case of the U.K., where we were, broadly speaking, just over half the country, we've gone off-balance-sheet to build out fiber for the rest of the country in this company called nexfibre, which I'm happy to talk about. Mm-hmm. In the case of the existing HFC network, because we have ducts, it's relatively inexpensive to go all fiber. Mm-hmm. In the UK, we will have a fiber network. To the extent to which you do believe fiber is, you know, necessary to compete. Mm-hmm ... we are gonna be all fiber, for what it's worth, in the UK. Mm-hmm. Similarly, in Switzerland, we are essentially renting somebody else's fiber. Yeah. Which is Swisscom. It's very attractively priced. We actually think that our network strategy is pretty good there. I probably should have said that it's hard to see fiber going in a lot of these countries into the truly rural areas. Mm. HFC, where we have HFC in the rural areas, I think that's also fine. In Belgium, as we know, they've created a fiber JV. Mm-hmm ... with Fluvius, which was partly to do with that, rationalizing that ownership structure. They've got a fiber strategy, and, you know, as you've probably seen from the financials of Ireland, we are all in. Mm. We should be done in a couple of years. In four of the five markets, I think we're pretty clearly, to the extent to which, you know, fiber is necessary to compete. Mm-hmm ... you know, I agree with you, reasonable man can argue, I think we're all, you know, we're making moves there. Holland is, of course, the big, you know, outstanding. Right. The question mark is: What's the right strategy in Holland? There are 2 fiber operators with no customers. We're the market leader with 50%, you know, network utilization. Yeah. How do we resolve that conundrum? That's a strategic conundrum we and our partner are highly focused on. I think the other observation I'd make is that about half our revenues aren't fixed. I mean, they're actually mobile, and a lot of it's also in B2B. Yes, we are the historic consumer business. To the extent to which you believe- Mm ... that the fiber has such a speed advantage that makes it absolutely inevitable, then we are perhaps more vulnerable only in one market. There is evidence to say. We've been competing with fiber for a very long time, and there is evidence, if you look at Holland and Switzerland, we've been competing a long time. Yes, you do lose some market share, but it's not disastrous. I think, you know, we're talking at most 5%, 6%, 7%. Mm. One of the debates, I think, around this higher interest rates, and I'm sort of jumping to your second question, you know, does that cut off access to capital of these other builders? I mean, if you stand back and think about it, I don't want to pick on people, but, you know, if you had a business plan which essentially assumed 40%, 50% penetration, let's say, in the U.K.... Mm-hmm to drive your economics, and I know what their economics are, 'cause I'm doing my own, and I've got marginal economics. Got it. They've got to be assuming 40% interest rates. Penetration, sorry. You must believe that the IRR is generated on cost of capital. Yeah. You rightly point out, cost of capital is reset. They're not hitting 40%, 50%. Mm-hmm. How can they? I mean, Well, me and BT are half the market. Mm-hmm. Sky has a 25%. I just think that the network position for us, you know, is not necessarily this sort of, you know, boom or bust. It's much more subtle than that. I also think that as we think about, you know, where we evolve, we get through the investment cycle from a Liberty Global point of view, and we do have the benefit of long-term shareholders. We're very appreciative of that. Mm-hmm. You know, we are looking at a position where we actually are laying the foundations for future growth. All right. There is a lot to unpick. There's a lot to unpick, yes, indeed. First of all, I think the position that we always made was that cable versus fiber is, fiber versus cable is not about speed, it's about economics. Cable being a much more expensive infrastructure to operate. Remember, it's marginal economics, because you've already spent a lot of the money on cable. I do accept that. I mean, a cable network is more expensive than a fiber network. Yeah. No dispute. Right. You know, maybe we'll get lucky, DOCSIS 7 or 8. I agree with that. It's marginal economics. I was glowing red, that one. Yeah. I don't think you and I'll be around. You might be, but I won't be around for that. No, no. Okay, why don't we start with the Netherlands? Mm-hmm. One of the challenges there, of course, is it's also, is it your most levered op co? Yes. I think it is. Yes. Where are we? Nearly 6x now, I guess. Yeah. is the leverage on that business. That's right. Which is probably looking- It's harder than the 3-5 that we would have liked. Right. What is? Not three to five, four. What is the roadmap out of that situation? Well, look, I think ultimately, the roadmap in cable has always been growth. Yeah. Right? The exam question is: How do you generate growth? Mm-hmm. The truth of the matter is that all our companies in the telecom sector as a whole Mm-hmm. despite this burst of inflation, hasn't been achieving above-inflationary growth. Mm-hmm. That's led the Netherlands to become, I agree with you, over-levered. Mm-hmm. Now, you know, I don't think we should, you know. We don't believe in 6x leverage. We believe in 4x-5x leverage. Mm-hmm. Whilst one of our other companies is over 5, which is Switzerland. Mm-hmm. They have obviously a roadmap to delever through synergies. Mm-hmm. In the case of the Netherlands, you know, we've got to figure out how we get the growth going, you know, what are the strategic moves that we can make. I think very much with our partner, we are working and evaluating all that. Now, we do start with some advantages. I mean, one in two homes in the Netherlands takes a broadband product from VodafoneZiggo. Mm-hmm. Pretty good. They're also the market leader in mobile. Yep. They start. If you're gonna have any kind of network strategy and you need customers, we are the market leader. We also have the, I wouldn't say, the best, because that sounds like we're pleased with ourselves, but they're the most differentiated service offering. Yeah. Which I think is pretty hard to argue. They've got the best content, they've offered the best customer service, et cetera. There is a lot of reasons to believe we're in a very strong position, very much similar, actually, to Telenet. I agree with you. I think that we need to find a pathway to delever, but we have a long time. I mean, the, you know, the debt in Holland, I think is six years. Okay. You know, we don't have to do anything in inverted commas on the repricing of that debt until 2029, 2030. Okay. I do not in any way dismiss that. Mm-hmm. you know, I'm not staring at a 24, 25. Revive. Yeah, exactly. Okay, let's jump on to the UK. Mm-hmm. it's your biggest asset- Yep. to speak. You have put in a plan. You've obviously got the additional 7 million homes that you're building through the joint venture, you've got the 15 million or so. Mm-hmm. -that you might converting over time. I think, on the recent call, I'm not sure whether it was Andrea who mentioned or whatever it was, but there was an acknowledgment that that migration was not maybe moving as fast as you might have hoped. I don't think that's. No. I'm sorry, if he said that, I'm surprised we think he said that, but we would say that. No, we're on track for. It was a seven-year program to essentially convert the existing 16 million. Okay. fiber. We're definitely on schedule. I think, I'm gonna get the numbers wrong here, three years in. Price is, you know, coming in at several hundred GBP a home. You're three years in, you've done 2 million homes. Yeah, that was the original phasing. Right. To balance to it, to achieve-. That's fair. To achieve that full run rate, you need to be doing $3 million-$4 million a year. Yeah. Well, I accept that, but we're definitely moving. Well, I mean, based on what we've seen and based on the management position, that they're on the plan they set us. You're saying you can make that run rate? Yeah. the only reason I challenge that. It is a long program. The original program was seven years. Yeah. You know, we're talking terminal values here, not near-term cash flow. Yeah. I'm just thinking, like, if I took a parallel, you know, BT is maybe gonna make GBP 4 million a year at maximum run rate, and that's the fastest fiber network that's ever been built. Mm-hmm. I find it hard to believe that you guys are gonna achieve that level. Maybe you will. Well, I think the answer is, look, I'm not sure. I mean, I'm the CFO. I mean, you know, at a certain point, you have to trust your management. Look, we're quite happy... Not quite. We're very happy with our management in the UK. Lutz is one of our franchise players. Mm-hmm. You know, he has a, you know, credibility. When he says he'll do something, he has credibility. Look, I think it's fair to say, like, you know, judge us on what we achieve rather than what we promise. Okay, 'cause I guess my challenge was to present another alternative. Mm-hmm. It comes back to a point you've made, which is there is a lot of, or there are a lot of arguably stressed- Mm. fiber builders out there who've built fiber- Mm-hmm. in these small regional towns, cities, whatever it may be. I think your point about penetration is absolutely correct. Mm-hmm. You need 40% plus, and you can't have three players with 40%. Is there an inorganic route or could there be an inorganic option? Yes, I think there. To build fiber. I think if we did that, and again, never say never. Mm-hmm. That's one of the reasons why having nexfibre, which is just to everybody's benefit, is this off-balance sheet vehicle within InfraVia, obviously ourselves and Telefónica. Mm-hmm. That's one of the reasons why you'd have a separate capital structure. Understood. By the way, it may do no acquisitions. Yeah. Clearly, we recognize, as does Telefónica and InfraVia, there is M&A optionality. We should be, you know, remiss not to look at it. Agreed. Was there ever an option, I mean, we've discussed the sort of rollout of. Mm-hmm for VMO2 for some time. There was a lot of press reports about whether you guys could actually find, you know, anchor tenants with the likes of Sky. Yeah et cetera. Yeah. I don't know whether there's anything you can comment on that or whether, you know, is the wholesale opportunity something incremental? Well, the wholesale opportunity is there. Yeah. It's incremental. Yeah. I think rather than promise it, we've got to deliver it. Absolutely. You should assume that we are discussing. Yeah ... with everybody, because, you know, as custodians of our shareholders' capital, you would expect us to do that. Got that. Having said that, we've obviously got nothing to announce as such. I mean, I don't want to sort of, you know, paint too pretty a picture. We did something in Ireland, as you're probably sure. Mm. We did do. you know, it's not beyond the wit of man to get wholesale agreements. Yeah. As yet, no news in the UK. It's not like we're saying religiously, never. We're just saying we have managed to put nothing off yet. Okay, just staying on the infrastructure briefly before we maybe dive into. Mm ... some sort of more operational issues. What the likes of InfraVia does allow and what these off-balance sheet ventures do allow is an alternative path to monetization. Yeah. Right? The question is, could there be an opportunity to almost, and I think I asked you about this on this call, start to move down the sort of ServCo NetCo split? Mm-hmm. Where you start to say, "Okay, maybe we're gonna establish off-balance sheet for VodafoneZiggo. Maybe we'll establish off-balance sheet for, you know, for another part of VMO2. Mm-hmm. we create this off-balance sheet monster, so to speak. Mm-hmm At some point, that's the route to monetization, and we'll get it. I think all options, David, are on the table. Yeah, I mean, I think I wouldn't say it's definitely going to be NetCo, it's definitely going to be ServCo. Yeah. I couldn't agree more with you. Yeah. I mean, there's limited models. There's one in Italy, there's a couple, you know, I think in Northern Europe. You know, we'll see how that model plays out. I go back to where we started. Mm-hmm. You know, I don't know about anybody else. I'm really frustrated. Mm-hmm by the fact that we can't get the value that we've created priced. Mm-hmm. I recognize that's because of conglomerate discount. I recognize that's because of complexity. Mm-hmm. NetCo's only add to complexity. They do, yeah. I also recognize that it's to do with the fact that, you know, we can't get the capital structures aligned. I mean, a NetCo capital structure is very different to a ServCo, and we both agree with that. Yeah. I think one of the things that we're trying to figure out is, you know, preparing ourselves to have the optionality. There's no promises here. Yeah the optionality to rejig the way these assets are presented to the public markets. Interesting They get better price. I say, I guess conceptually, if I ask you that question, do you think that the telco works as a, as a combined ServCo NetCo? I think the telco can work as a combined ServCo NetCo, and it might work as a NetCo ServCo. I think the answer is we are pragmatic, but we're in the business of trying to create value or price value. I think we've created value, he says arrogantly. Price value for our shareholders. Yeah. The exam question is how best to do that? Yeah. I suspect the answer is probably not in one, you know, conglomerate-listed stock. At least the evidence will be, that's quite hard. Right. It does create value because it gives us an opportunity to buy stock cheap. Yeah. You know, we are monetizing the delta. You know, I appreciate... You know, what's a bit frustrating is, having bought back what, nearly 60% of the company- Mm-hmm it's quite a lot of shares. Mm-hmm. We have $1.1 billion, now we're at $400 million. Mm-hmm. We're buying hard. Mm-hmm. We've committed to 10% a year, and last year we did a lot more, so you can probably surmise that, you know, at least price. You know, we are shrinking the FP pretty hard. If and when we can unlock this discount, there's a lot of value there to be created. Okay. The question is: How do you best create that, you know, or price that value or position that value? Yeah. I mean, I guess because it's quite interesting, I think I asked, Mike. Mm ... Q2 2021 call, 2022 call. I just said, "Aren't you a little, aren't you getting a little tired of this? Why don't you bring the whole lot in? Well, I think we are bringing it in. We're taking a, you know, we're buying back a ton of the stock. Cheap, right? I mean, you know, I wouldn't say it's just slow go private, but I mean, the logic of our position, the logic is they'll be about you, me, and Mike, and we'll own the whole company, you know, which when you get through this investment cycle, is gonna be chucking up a lot of cash flow. Yeah. You know, HFC or fiber notwithstanding. Okay. You know, the optionality to spin and break this thing up into more price-able bits. all of. Yeah, there's a long-term, very, very attractive story here. Listen, is Mike frustrated? Of course, he's frustrated. Yeah. You know, he and I have been at this, I've been at it 25 years, he's been at it 30 years. You know, he is absolutely as frustrated as anybody. On the other hand, what I like about Mike is he doesn't panic, and he's doing the right thing. These are the right long-term moves. If you want us to goose the free cash flow, we'll just stop all the investments. Mm. Pretty easy. I know how to do it. Mm. You cut the spending on marketing and stuff. If you want the free cash flow to pop, if you want us to try and pop the stock price, of course, we could do a tender. I'll listen. There's $3 billion of cash and drive the thing up to 35 to watch it come down again, you know, maybe we can all price our options out. We're not doing that. We're trying to do the right thing for the long-term shareholder, I think that's our... That's always been our commitment. Do you think if you stop the cost and CapEx investment today, the NPV of cash flows will actually be higher? I think the NPV of the near-term cash flows is higher. I mean, I'm with you. I think I'm in the. Interesting of building a long-term asset. Yeah. I don't want to talk any other some of my investors, but we've seen people over the years. Yeah. You know? We have. Uh. All of these options, you're moving to Bermuda. Not sure whether that's you personally. Well, we're not necessarily moving to Bermuda. We need shareholders to vote for it. Okay. The point- I maybe give you the pitch. I mean, look, it's American governance. Yep It allows it much easier for us to make these corporate maneuvers. Right. You might go, "Well, why can't you do it in the U.K.?" The way U.K. law works, it's much harder to get the votes. I know that. Mm-hmm ... because we had a trial run with Latin America. Mm. You know, we tried to get Latin America spun, and by the end, you know, we were ringing out moms and pops in, you know, whatever, to try and get the... Because it is, it's in a different form of governance in the U.K. The benefit of Bermuda is that it makes it much easier for us to break and spin. As a, 22 million line potential owner in the UK- Mm ... 22 million fiber line, do you ever have any sort of interactions with the U.K. government, because you are essentially, BT is one of them, but you are the other obvious fixed infrastructure provider? Yeah, we do. I mean, again, we have a regulatory, we have a corporate regulatory group, and we have obviously opco regulatory groups. Yeah. Look, let's be honest. The big issue in the European telecoms industry is competition and regulation. Mm-hmm. Competition is a derivative of regulation. Clearly, I'm an operator who's been in the market a long time. I would observe, I think it's 150 telcos in Europe, and let's call it around number 6-10 in America, 4-5 in China. I mean, you don't have to be a genius to spot that there's too many players. Mm-hmm. That is driving down returns, but it's also providing, and I would say this to the regulators. Mm-hmm. it's providing lower investment and lower quality products than you will get in the other markets. Let's dive into the U.K. I would assume that you are, as long as the field is kept fairly clean, you are in support of the proposed Vodafone Three merger? Yeah. I mean, we believe that market rationalization makes sense. Yeah. you know, not on any spectrum. Plus, spectrum is a big one. Yeah. Okay, in the UK, what we're observing at the moment that's very interesting is because of inflation and because of the inflation ladders in the contracts, we're seeing some of the highest price rises in the UK. Yeah. that I think we've ever seen. Yeah. What's curious is to watch the reaction of the service revenues, how much of it you can actually monetize. I think there was a sense that maybe over the last 12 months since the big BT, the original 9.3% in the 1st of April 2022, is that they've maybe monetized a little bit more than VMO2 did. I know there's moving parts with lots of video, et cetera, but why has VMO2 not been able to take those price rises and put it onto service revenue growth? Well, it's a complex story, and I apologize if I go off onto a slight discourse here. First of all, mobile price rises, I think we're broadly in line with everybody else, and we're doing just fine. We'll take it. It's about the fixed business. If you look at the fixed business, the fixed business is essentially three businesses. It's a fixed telephony business, voice telephony, for want of a better word. Mm-hmm. It's in decline. It's a video business declining probably about 5%- Mm-hmm. In volume of subscribers a year, and that's true to everybody around this table. A high-growth broadband connectivity business. To make it even more complicated, when we tell you that the GBP 50 quids worth of ARPU for that triple play- Mm-hmm. We could allocate, I could allocate anything I like to those two buckets. Yeah, yeah. I remember having a story in Ireland about 10 years ago and saying, Well, we think it's 20 quids worth of value out of the 50 in in voice telephony, and my CEO the day saying, "No, no, no. It's about 5. Yeah. The answer is, I can't really quantify. I can make any number if I like. Yeah. I can't really quantify it. I think we all get it. It is hard to see ARPU grow at these absolute rates because there's that contrasting trend. I think the second observation is that Virgin was the high-price provider. Yep. Therefore, we have this front book, back book, where there's discount offers, and therefore, there's always been this propensity when you're the high-price operator, to see, you know, the spin down for the savvy consumer. There is a proportion of the UK that is very savvy like that. I think the third thing is from a contract structure point of view, we hadn't had a formal indexing. Right. Which will come next year. It's a long way of saying it doesn't surprise me. I mean, I'm with you. I couldn't be happier if we had a 10% ARPU increase. We were never gonna get that. Mm-hmm. On the other hand, I think the underlying trends are actually are better than you think, because broadband connectivity, at least the way I look at it, as the custodian of your capital, that has still got good pricing power. Notwithstanding your comments about fiber, people still think to put a high price on the value of the Virgin network. That is attractive. Yeah, that's interesting. I guess one of the sort of observations we always consider is the classic front versus back book. Yeah. again, you know, dissecting what forms. The first observation as a CFO or as owners, we go, "What the are you doing there? I mean, that makes no sense." You know, "Why would you keep offering this lower offer that comes off after 12 months? Aren't you encouraging?" Unfortunately, that does seem to be the market structure, and it does seem to be the market structure accentuated by these overbuilders. Right. I don't know if I've got, I live in Kensington, you know, which is very nice, but there's a guy called G.Network. Yeah. He's now marketed me 4 times. Right. -over 2 years. I think his penetration is like 4% or 5%, he started off by going 30 quid, then he went to 20 quid, then he went to 10 quid, now it's free for 2 years. Free fiber for two years. For 2 years. With an installation fee. Well, not free fiber, as in two years free, and then. Yeah. You know, Mr. Bracken's going out brothers, I mean, not because she likes Lutz. She's doing just fine, thank you. Right. Okay. I think, I do think that, you know, these are, so these to try and drive penetration, we've got nothing else to differentiate you. You know, why does Louise like Virgin? She likes all the value-added services... Okay. -content and whatever. Okay. Let's assume then that there's a little bit of back book to front book that still needs to sort of balance. Well, that may be around for a long time. Right. I think the more likely narrative is that once we get through the voice telephony, let's be honest, and reasonable men can argue what it is today. Yeah. there's not a lot to go. Yeah, yeah. The video will continue to migrate. Remember, the video was never our most profitable business. Yeah. In fact, many might say it was a marginal business. Yeah. The economics are getting better with the new set-top box technology, et cetera, et cetera. Mm-hmm. I would argue that actually you could see fattish ARPUs, accelerating free cash flows over time. We have to, you know, demonstrate that narrative over the next couple of years. I guess the actual EBITDA growth that we're expecting from VMO2 this year. Yeah. is still primarily driven by the integration. I think it's pretty much synergies. Right. I mean. Look, I think if Lutz were here, he would say, and, you know, we're very appreciative of all the hard work our employees do and what they do for us, but there's a lot of complexity that can be rationalized and sorted out. Just like everybody else, technology offers us, as it offers all telecoms- Mm-hmm. by the way, opportunities to simplify and reduce costs. Surely. A big part of what he's doing is the classical synergies. We, as a shareholder, put pretty low risk on that. Yeah. We'll see how it goes, but I'd be very surprised if that doesn't overperform. On top of that, he's got a big opportunity for simplification and rationalization. He's got a real focus on digitization. Out of our portfolio, we would argue he's the most advanced. Porter is now gonna call me up and say, "Screw you, Bracken. Yeah, he might. We've got, we've got this. That's quite interesting. Obviously, from a financial dynamic, we've got this EBITDA coming through from the synergies. I mean, that will probably start to roll off a little bit, I guess, in 2023, 2024, more like. Yeah, maybe 24, 25. Okay. then perhaps- Don't forget, IT systems take a long time to integrate. Right. Remember, we had that in Vodafone, Ziggo, Telenet. Yeah. I mean, that's not a five-minute thing. No, that. I think we're about. Yeah. 50%, 60% through it. Yeah. There's a bunch of near-term stuff, but the longer-term stuff. Got it. Okay, so that's. Let's assume that we start to find some, you know, the voice revenue start to bottom out. Mm-hmm. Maybe the TV finds its base, and we start to get some of that price growth starts to come through on the top line. You've still got a relatively high leverage of the MO2... Yeah. as well, and that was used to redistribute the capital. Yeah. of course, to the G GBP 2. That's the 4x-5x. Now, how should we be thinking about that? Well, I think we are still comfortable at the 4x-5x. I mean, I've been around quite a long time in the telephone sector. There are times in the cycle when leverage, everybody wants me to levered 8x. There are times when we lever 2x. Right. You know, I've spent a lot of time, you know, with a guy who knows more than I do, John Malone. We're pretty comfortable in that 4x-5x. Yeah. We have given ourselves a long runway in all our markets. Yeah. UK being another example, 6-7-year average life. Yep. You know, we're fully. Mm-hmm. totally swapped, blah, blah. Mm-hmm. We will assess it, and if rates resettle out, let's make a number up at 6%, 7%, and you're right, pricing doesn't settle out with any kind of pricing power, we might have to reevaluate. Mm-hmm. We've got plenty of time to make that determination. The two are somewhat linked. You know, inflation, you know, should be linked ultimately to interest rates. Should be. Okay, and but for the foreseeable future, we should imagine that you're happy distributing cash flow at the existing- At the Virgin level, because I'm so confident in these synergies that are coming through, I don't think you should be expecting me to recap materially the other businesses. Understood. Okay, clear. let's go on to something, and now for something a little different, Ventures. Yes. Ventures looks very, very exciting. Obviously, we've, you know, there's always a question about sort of, you know, non-listed asset values, et cetera, and maybe. Very hard. That would be... You're talking about spins and things. what do we do with Ventures? Look, I think we like to think that we have a track record of growing but developing businesses. You know, we took analog cable systems in the 1990s, invested a lot of capital. Mm-hmm. Turned them into broadband businesses. Mm-hmm. Took broadband businesses, merged them into mobile businesses, and created what we thought were FMC businesses. I mean, it's not unusual for us to keep reinventing ourselves. Mm-hmm. It would seem to us there are two forms of growth. One form of growth is to try and take your existing platforms and grow from within that. We talked about some of the levers. Mm-hmm. You could imagine some of these FMC companies going into adjacent areas. You know, I call telcos, we're trying to figure out what those are. E-health, home security, blah, blah. Mm-hmm. You could also imagine that there are opportunities to leverage the adjacencies that you've got, whether it be insight, scale, whether it be the fact you've got anchor tenancy. Can you leverage that into driving new growth businesses? Mm-hmm. To that end, we believe there are broadly three areas that we think we have that opportunity. One is in technology, which we perhaps talked about. One is in content, 'cause we have insight into what content can actually create value. Mm-hmm. The third thing is in infrastructure, which has a different capital structure and pricing. To that end, we have tried to identify a portfolio of assets that we'd invest against that. To that end, you know, the plan will be to grow quasi-unicorns at very low marginal costs, which I'm happy to give some examples of. Then the question is, how do you monetize that? Do you sell it for cash, like we did with Cello, for those who remember that? In the content space, we built a multi-channel television business over 10 years. Mm-hmm. sold it when we thought multi-channel television was peaking out. Mm-hmm. Do you create it by spinning it off to your shareholders? You know, Malone style and Liberty Media. Mm-hmm. Another reason why we were quite keen on this idea of corporate governance and corporate flexibility. That's where we are in the, in the journey. In terms of the progress so far, I mean, unless you want to ask me a question about it, I'm happy to give some progress so far. Please. you know, in the case of technology, we traditionally had a fund that was really investing against in our R&D. You know, we were better off renting entrepreneurs. Casa was the famous one, you know, CMTS, which is a bit of kit in the network. We were able to get in a discounted value because we gave them our anchor tenancy. Mm-hmm. The, it drove $250 million of, we think, reduced spend versus Motorola and the others. Mm-hmm. who were providing suggestions at the time. We ended up making $300 million-$400 million on it, which is about a 10 bagger. Mm-hmm. Broadly speaking, what they've got is about 50 companies. Like all these tech portfolios, the value is 80% of the values of five of them. We're in for about $400, market value of $900. These will make a discrete at $900. You know, we think it's not a bad bet. We're not gonna put any more money in that. Mike says they live off what they kill or what it is. They kill. Got it. Albeit there would, could very be ways to get that price better. Should we merge them, spin them? Again, we go back to that famous debate around Bermuda. The second bucket is content. When we sold Cello, we took some of the cap. We sold Cello for $1 billion. We were in for zero... Mm-hmm. We'd recapped our way out of it. We took some of that $1 billion, and we invested, broadly speaking, in two big assets. We thought high-end TV production would be a growth business and be easier to finance because it was all becoming a cost-plus business, 'cause the streamers were prepared to buy it for perpetuity. You're getting a sort of, you know, 20%, 30% markup, so you can financially engineer it more. Understood. We, you know, financially engineered it. Mm-hmm. In due course. We thought it was a consolidation play, because we felt there were lots of these mom-and-pop operators. Mm-hmm. Together with Warner Bros. Discovery, who knew a lot more about that type of content than we do, we got involved in All3Media, made a series of acquisitions. You know, I'm not gonna comment on whether it is, but we have, we believe, created quite significant value there and an attractive asset that many people would like to own. Okay. The other bit in content was we have been on the receiving end of sports rights, you know, renting sports rights. Thought it was a good idea to invest in underlying sports rights. The big play there was this company, Formula E. Yep. Where effectively we had the monopoly on electric vehicle motor racing. Which again, with Warner Bros. Discovery, I mean, as Malone constantly reminds me, Formula One is a $16 billion equity value business. The exam question is: What is the value of the electric vehicle? Mm-hmm. The third bucket really was infrastructure, which was to say, "Look, if you stand back and think about it, you know, we're in the business, as you rightly point out, with NetCos, with infrastructure. Mm-hmm. There are three buckets today we're looking at. One is last mile companies. nexfibre being an example. Mm-hmm. I would say a bit more, you know, infill of the existing core assets. Mm-hmm. The two that we're really looking at, in a very small way, I would say smart energy. I believe telcos have a right to play in that, so we've invested sub $10 million, but managed to leverage partners. We have a partner called Zouk, for example, in destination charging, leveraging on our building expertise. We also, because of our marginal economics, break even already on our smart energy installation business called Egg, but these are tiny businesses. Mm-hmm. You know, it's gonna be a big space. Mm-hmm. The one that we're perhaps most interested in is digital infrastructure. We created a joint venture with a company called DigitalBridge, which is really all about edge cloud computing data centers. If you believe that the cloud's gonna get bigger, not less, believe the cloud's gonna go to the edge, believe AI, metaverse, all these buzzwords, means you need more computing capacity closer to the customer, then, you know, you should be buying into AtlasEdge. That's a business that's going pretty well, actually. I mean, they're already about $35 million-$40 million of EBITDA. Their revenues are about 30% organic growth. Mm-hmm. It could become a multi-billion dollar business, and our capital commitment is relatively little, given the way we structured it. Got it. That was a long answer, so I probably. No, some interesting assets for sure. Okay, I'm gonna pick out one of those buzzwords, actually, AI. Yeah. You know, we've obviously written quite a lot about this, and it feels like that the telco industry is one which has a significant customer service level, layer, I should say, that maybe, and we can debate this, hasn't been the best managed over time. I think that's probably fair. You also consume a ton of electricity, arguably inefficiently. Yeah over time, with full-powered networks at 2:00 A.M. Yep. You are, you know, you have significant up and down time in the networks, network faults, et cetera, that could arguably be improved. The question is, how are you guys thinking about AI? Do you have, like, a work group? Do you have a think tank? I'm sure AI sort of predictive algorithms are already out there running, but could generative AI find its way into customer services? Could you know, bring down the number of retail stores? Is that an end game here? How are you guys looking at AI at Liberty Global? I think, look, as a macro trend, it offers great opportunities. Mm-hmm. We're gonna coordinate that through, at least from a Liberty point of view, our Chief Technology Officer, Enrique, and his team. Mm-hmm. Mm-hmm. How we implement it, however, isn't gonna be a sort of centralized, you know, from the turret, we'll tell you what to do. Yeah. Every individual opco and every different function, we've talked about functions as well, is approaching it to try and figure out where we can provide scale. A good example actually is finance. Mm-hmm. You know, Mike will tell you, we just had our finance conference, which the whole thing was on AI and technology and the ability to transform the end-to-end finance cost. Finance isn't the biggest cost. Not gonna replace the CFO, is it? Well, I hope he would replace the CFO- Okay I can go to the beach. No, it is things like, clearly it's not lost on anybody, accounts payable, back office, but even stuff that you hadn't thought about, keeping track of where all the new homes are. Mm-hmm. When you build nexfibre, who's running that database? How does that all get worked? Mm-hmm. I mean, this is a small business, about a $100 million turnover business, but, you know, we actually provide services to all our companies on an arm's length basis, and, you know, pretty good business. I mean, they've got 300-400 robots. They're pretty advanced. They've got good working relationships with Google and Microsoft. To me, the big issue here is the implementation. Mm-hmm. We've got to avoid this becoming the IT priesthood, who's sort of going to rationale how this AI is rolled into the businesses. Right. Similarly, each of the opcos, let me pick on Lutz, you know, have done exactly the same. Lutz has a group, I think it's 300 or 400 people, working on digitization initiatives. I'm not sure publicly what we've said about it, but Lutz has got some very optimistic, very positive, you know, views on how much he can save through that. The numbers are out there. Which is one of the reasons why he's very comfortable with his, you know, his growth rate profile, not just through the synergies, but beyond. Got it. Let's prove that out, rather than just promise it. Mm-hmm. The answer is, we're approaching it on that decentralized basis. Mm-hmm. We're trying to do it with an overall narrative. Okay, I guess, as ever, you prefer full autonomy in the opcos, basically? Look, God knows, we've tried this. You know, you can go full centralization, full local, you know. Yeah. I hate to sound like John Porter, I agree with John Porter. I think that, you know, the customer is at the local level, we should be driving, you know, what suits the customer. I agree with you a bit, actually. I think, you know, the big opportunity in telcos is to get even better. Let's use it even better, customer service and customer management. I think if you can really crack that. We've seen pockets of that. We have a company called giffgaff, which we didn't build, which O2 built. That's very successful. Yeah. Very impressive, the way that they run their business in that mobile space. It still feels like the challenges, and especially with things like retail stores, I constantly challenge management teams. Yeah -as to why you need so many. Well, they are reducing. I mean, the narrative is clearly coming down. Slowly. Slowly, but I think it's also... Well, listen, first of all, I'm with you. Mm-hmm. You should be in my meetings, I don't see any resistance there. Often, the argument is you need a showcase for your products. Mm A place to, for a certain proportion of your customer base, to go in and get your iPhone repaired. Mm. My 12-year-old kept dropping his iPad, which, as you know, it's not good news when you're a father trying to be left in peace. I feel you. I was able to go to the O2 store and get it fixed. Right. I still could have gone to the Apple store, but there's an element of that as well. They aren't just sales and marketing channels. They're also customer care and maintenance. No, I think that they're good answers, 'cause one of the answers that I've actually had twice this morning that disappoints me more- Mm. is almost because the other guy is still there. That isn't the answer. No. Okay. Okay, we've got this- By the way, don't hold me to this, but in 5 years' time, we'll have virtually no stores, I think is what I'm hearing from my opcos. We might figure out different ways to do this care and maintenance thing. Yeah, sure. No, I think that makes a lot of sense. Okay, we've got this digitalization that's accelerating... Will take time. Will take time. Will be an underlying narrative. I like Margherita's narrative. No, OpEx should be flat to down because of these kind of opportunities. When you've got big, complicated acquisition build stories, you should have the opportunity to double that with simplification and the like. 'Cause I- It's not big bang. I don't think I can look you in the eye and say, "We're gonna take 30% of the cost base out next year 'cause of AI. Yeah. It's gonna take time. Right. The big opportunity, I look at it, Bryce, narrowly from the finance experience. You've got to, you know, make sure you do it. Evolution is the word I keep using, not revolution. Otherwise, you can lose control and the thing can fall apart. Is this not an industry that needs revolution? I think it needs revolution, but we need to do it in an evolutionary way. Mm. I've seen companies over the years- I'm not gonna let you get away with that one. Well, if you do this big, dramatic 20% headcount reduction. Yeah. you know, my experience has been that's very dispiriting, and that creates almost more complexity. I've seen that movie. You know, you should assume that our local capital allocators are pushing us hard. I was in a meeting yesterday, reviewing the runway plan for our central corporate costs, which are about $200 million a year. Mm-hmm. for the next few years. Mm-hmm. You know, and I kept asking the question to the capital allocators who, you know, rolled this up: "What are you doing? Where's the AI plan? What's the AI plan here? Mm-hmm. you know, but it is keep pushing away and knocking off processes is the key. How about, just very final question? Yeah. At the, regulatory level in Europe, I'm not sure to what extent you guys like to be part of that debate. No, we do like to be part of the debate. And how- Fair Share. Yeah, how do you feel that you're not talking about the Fair Share with the tech companies there, are you? Well, I know I'm talking about the Fair Share with the tech companies. Look, I would say, to quote John Malone, when I was at our offsite in March, "The wind's been in our face regulatory for quite a while now." Feels like the wind is tacking around. Yeah. I mean, you have as educated view on this as I do, by the way, so you know. My sense is that there's more wind at our back. Yeah. I think the regulators recognize they have driven this industry to very low return on capital. Yep. They've driven this industry into lack of capital to innovate and invest in what the customer needs. There is a danger that we will fall behind, at least in terms of this key digital infrastructure, to the others. Yeah. How that translates, maybe this Three Vodafone is hopefully a first step on that journey. Mm-hmm. That can only be welcome compared to what we've been experiencing over the last. The but the winds are changing. We believe they're changing. Again, there's no monopoly on wisdom here. I mean. Yeah you're a very educated observer. What do you think? I think they are changing a bit. I think the, the proof is in the pudding, so to speak. I agree with that. Let's see what they say. Yeah, it's like all these things. We shouldn't just promise stuff. I think we let's just deliver stuff and see what happens. I think, I do think, you know, Three Vodafone, under the right conditions, is a good thing. I think we've got some good examples, globally of where 4 to 3s have actually created better businesses that have challenged, the U.S. being the best example. Yeah, the US is a good example. Giving you a 1-minute light. We're gonna finish 1 minute late- Yeah. 'Cause I'm aware that everyone's got tight schedules. Well, thank you very much. Again, I'm sorry I was a little bit late. Thank you, everyone. Thanks so much. Thank you. Thanks. you. Thanks. Thanks, Charlie.