Sony CEO Sees No Major Financial Impact From Cyber-Attack

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By Reuters | Updated: 7 January 2015 09:31 IST
Sony Corp Chief Executive Kazuo Hirai on Tuesday said he does not expect the November cyber-attack on the company's film studio to have a significant financial impact, two weeks after the studio rolled out the movie at the heart of the attack.

The studio, Sony Pictures Entertainment, said separately that the film, "The Interview," has generated revenue of $36 million.

Hirai told reporters at the Consumer Electronics Show (CES) in Las Vegas that he had signed off on all major decisions by the company in response to the attack, which the U.S. government has blamed on North Korea.

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Sony's network was crippled by hackers as the company prepared to release "The Interview," a comedy about a fictional plot to assassinate North Korean leader Kim Jong Un. The attack was followed by online leaks of unreleased movies and emails that caused embarrassment to executives.

"We are still reviewing the effects of the cyber-attack," Hirai told reporters. "However, I do not see it as something that will cause a material upheaval on Sony Pictures business operations, basically, in terms of results for the current fiscal year."

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Sony Pictures said "The Interview," which cost $44 million (roughly Rs. 279 crores) to make, has brought in $31 million (roughly Rs. 196 crores) in online, cable and satellite sales and was downloaded 4.3 million times between December 24 and January 4.

It has earned another $5 million (roughly Rs. 31 crores) at 580 independent theaters showing the movie in North America.

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Sony's unprecedented simultaneous release in cinemas and online came together after it canceled the planned Christmas Day wide release of "The Interview" because major movie theater chains refused to screen it following threats of violence from hackers opposed to the film. That decision drew pointed criticism, including from President Barack Obama, that Sony had caved to hackers.

Within a week, the studio struck deals with small movie theaters that said they were keen to defend free expression and with technology giants like Google Inc for a simultaneous online release on sites like YouTube Movies. Apple's iStore came aboard a few days later, as did major pay TV providers.

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It is still unclear if Sony Pictures will recoup the costs of the film, starring Seth Rogen and James Franco, including an estimated $30 million to $40 million marketing bill.

On Monday, Hirai praised employees and partners of the Hollywood movie studio for standing up to "extortionist efforts" of hackers, his first public comments on the attack launched on November 21.

Sony Pictures may need several more weeks to rebuild its computer network after what has been deemed as the most destructive cyber-attack on a company on U.S. soil. North Korea has denied it is behind the attack.

© Thomson Reuters 2015

 

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