Sony's entertainment pivot deepens as Spider-Man opens to $900M
What's the deal? SonyDealroom has a profile for this one. Try Dealroom → chief executive officer Hiroki TotokiDealroom has a profile for this one. Try Dealroom → is steering the company from consumer electronics toward entertainment, betting its future on music, movies and videogames. Since taking the top job last year, he has offloaded Sony's TV business into a joint venture with a Chinese rival, brought in TSMC to collaborate on image sensors, and spun off Sony's financial arm.
Why now? More than two-thirds of Sony's annual revenue now comes from motion pictures, music and videogames. "Traditional businesses are important. I have great respect for these businesses," Totoki said. "But at the same time, we need to change."
The product play: Sony's latest Spider-Man film pulled in more than $900 million in its opening weekend worldwide in August, the second-biggest movie launch ever after DisneyDealroom has a profile for this one. Try Dealroom →'s "Avengers: Endgame." Its music unit hit a new quarterly profit record, helped by LionsgateDealroom has a profile for this one. Try Dealroom →'s "Michael" biopic reviving interest in Michael Jackson's catalog.
The endgame: A core strategy is turning hit videogames into films and TV shows to keep properties earning. After "The Last of Us," a drama inspired by a videogame, Sony is adapting "God of War" for TV. "That's the flywheel we like to make," Totoki said.
The expansion: Sony has made a big bet on anime, a source of pop-culture hits such as "Demon Slayer: Kimetsu no Yaiba." Totoki said the company is looking for ways to integrate gaming and anime, genres he said have a natural affinity.
Why it matters: Founded in 1946 as a radio repair shop in bombed-out Tokyo, Sony built its name on the Walkman, Handycam and PlayStation. Its 1989 buyout of Columbia PicturesDealroom has a profile for this one. Try Dealroom → for around $5 billion, including debt, once served as a business-school example of corporate hubris after Sony wrote off most of the investment within five years.
The signal: The transformation marks a definitive break from Japan's consumer-electronics heyday. Sony's consumer-electronics business is now a sliver of its former size, while franchises such as Spider-Man and Jumanji anchor a company that Totoki says few would have imagined 30 years ago. "No, never," he said. "People didn't mention the entertainment industry at all."
Read more: The Wall Street Journal
Image credit: Sony
