Sony CEO Reaffirms Commitment to Studio
Sony CEO: Dan Loeb Helped Put Spotlight on Entertainment Assets
TOKYO – Sony Corp. CEO Kazuo Hirai, who has continued to face speculation that he could sell Sony Pictures, on Thursday reiterated that the studio is an integral part of the entertainment and consumer electronics conglomerate and its broader strategy.
"I have always said, when asked the question about why we have the entertainment properties, one of the most important reasons we have them in our business portfolio, just like why we have financial services, is that it's a profitable business to be in,” said Hirai, who took over as Sony CEO from Howard Stringer last April. “And I like to have profitable businesses in my portfolio.”
Although Sony has faced some criticism over the years for its holdings in areas such as movies, music and finance (it has a large financial services division in Japan), those units have been profitable in recent years when its core electronics business has struggled. And he emphasized the synergies that Sony can reach as a key reason for its
continued ownership of software, as well as hardware businesses.
He particularly cited the example of synergies for 4K, the next generation of television technology.
“One of the most important things for technology like 4K is content," he said. "We will be working with Sony Pictures, so that when a consumer buys a Sony 4K television, there is a method for them to access Sony, and other native 4K content suppliers. I can't speak for the other manufacturers because they don't have motion picture studios, but we're going to leverage the relationship that we have.”
Hirai also harked back to the development of Blu-ray, saying it was crucial not only to have had the support of Sony Pictures, but also other studios, to back the format in its victory over HD-DVD. “We would not have been able to do that at that speed without the support of the studios,” Hirai said.
In late October, amid latest Hollywood speculation about a possible sale of Sony Pictures, Hirai responded to a query from THR by saying: “There is absolutely no truth to rumors that Sony’s Entertainment businesses are for sale...Our entertainment companies have a stable business foundation and are poised for future growth. There is no reason to sell these industry-leading businesses, and no consideration is being given to the idea."
To turn around Sony's loss-making consumer electronics business, it must look to develop products that are both profitable and have the "wow factor," Hirai said Thursday.
“If I just sat in my office, that's not going to happen," he explained. "I've circled the globe six or seven times in the last nine months, getting into the trenches, visiting our R&D centers and even factories, speaking to engineers directly. I've picked up several products directly and am shepherding them to market." He didn't disclose further details.
“I only have two hands, so I can't do that for everything. So I have to surround myself with people who are passionate about products too,” he added.
Hirai repeatedly pointed out that he had replaced all but two of Sony's senior management team since he took over nine months ago in his quest to revitalize the company.