Question-and-Answer Session
Operator
(Operator Instructions) Our first question comes from Paul Thomas - Roth Capital.
Paul Thomas – Roth Capital
You gave us some color on Penthouse and how that’s going right now. Any update on private?
Ken Boenish
As far as our private distribution goes, earlier in the fiscal year we created a brand new VOD product called Foreign Erotique, and we’ve to-date gained quite a bit of incremental distribution as a result of launching that product. I think we’re up over 8 million new VOD households taking that new product.
Paul Thomas – Roth Capital
Any update on the dividend policy at this point for next year?
Michael Weiner
What I can tell you is that our board of directors’ policy has been to pay a dividend on a quarterly basis. This remains the policy of the board. The board, of course, does have the right to modify that policy if, for example, financial conditions change or the board determines that alternative uses of the company’s capital would provide greater shareholder value.
Operator
Your next question comes from Aram Fuchs - Fertilemind Capital.
Aram Fuchs - Fertilemind Capital
I was wondering if you can talk about if you are searching for a CFO?
Michael Weiner
We continue to search, but have not yet made any decisions. In the meantime, we have a topnotch controller and we continue to work with Matt Pullam who was our original hire, on a consulting basis for oversight of our financials. Matt remains our Chief Accounting and Financial Officer and signs off on all our filings.
Aram Fuchs - Fertilemind Capital
To give a little context, I’m trying to figure out if your value-add to the MSOs and DBS players is changing. It seems for quite some time you were a nice alternative to Playboy, but now with their channel capacity and bandwidth expanding there can be other players. Do you agree with that assessment? If you do, how do you react in such an environment?
Ken Boenish
I’ll take that question. It’s true that we have seen a capacity increase, especially on the VOD side of the business. But I think it’s important to note the performance track record of our company in both the VOD and the pay-per-view space. From a performance perspective, to give you an example, we occupy just 29% of the total server hours on the largest VOD platform in the U.S. while our product produces more than 40% of all the buy transactions. So we think there is really no clear indicator of our success, of our marketing monitoring, our research and our fast cycle programming change systems we put into place over the past two years.
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