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Sony Pictures Technologies – FY13 Three Year Plan Review

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Sony Pictures Technologies – FY13 Three Year Plan Review Sony Pictures Technologies – FY13 Three Year Plan Review Agenda Page I. Group Overview . Group Mission & Prime Objectives ……..………………………………………………………………… . SP Tech Showcases: Distribution Backbone, WPF Supply Chain, DECE, Colorworks .……………….… . SP Tech Genesis and Functional Organizational Chart ……………….…………………………………… . Departmental Overviews – Core Functions, Financials & Key Facts/Achievements: . Colorworks ………………………………………………………………………………………… . Digital Media Group ………………………………………………………………………………. Technology Development …………………………………………………………………………. WPF – Asset Management ………………………………………………………………………… . WPF – Global Logistics …………………………………………………………………………… . WPF – Client Operations ………………………………………………………………………….. Digital Policy Group ………………………………………………………………………………. Corporate Alliances ……………………………………………………………………………….. 3D Tech Center ……………………………………………………………………………………. II. Three Year Plan . SP Tech EBIT Improvement (Revenue Enhancement & Cost Reduction) Actions .………………………. Proposed New Functional Org Chart ……………………………………………………………………… . Three Year Plan Headcount Roll ………………………………………………………………………….. Other Strategic Opportunities & Considerations …..………………………………………………………. V. Appendix . FY13 Budget Data ………………………………………………………………………………………….. SP Technologies Organization Charts ……………………………………………………………………… . DMG Usage Chart …………………………………………………………………………………………. Territory Account Growth ………………………………………………………………………………….. SPE Confidential 1 2 SP Tech Group Overview Sony Pictures Technologies – FY13 Three Year Plan Review Mission Mission Statement: Where is the mission statement from previous years? We’ve realized these core objectives for the benefit of SPE in many ways – some of the higher impact initiatives that showcase SP Technologies contributions include the Distribution Backbone, WFP manufacturing savings, DECE and Colorworks Production Support …… SPE Confidential 3 Sony Pictures Technologies – FY13 Three Year Plan Review Recurring Themes . Protect long term asset value . Technology should be transparent . Faster, Better, Cheaper These themes will be active across the division SPE Confidential 4 Sony Pictures Technologies – FY13 Three Year Plan Review SP Tech Showcase: Distribution Backbone The Challenge: . The costs of physical duplication and distribution labor, materials and transportation are increasing • The work is repetitive and mechanical . The market has changed from a few large customers to hundreds of customers in a wide range of sizes • Unit distribution volumes are increasing while individual unit transaction values decrease • Physical distribution systems do not scale economically • The costs of supplying the increased volume through traditional methods would be cost prohibitive The Solution: . Digital technologies have transformed the creation, distribution and consumption of entertainment media. A change to file-based media deliveries allows the opportunity for an automated workflow . In partnership with Sony DADC, the Distribution Backbone was developed to automate the repetitive tasks, eliminate physical media and transportation costs. • SPE businesses will deliver approximately 80K file-based media assets to our customers this year • Expected to grow to 180K by FY15 (60K related to Ultraviolet) • To deliver these 180K files would cost approximately $35M existing 3rd-party offerings, even taking into consideration the downward pressure on rates, vs. $11M with DBB • After FY16, the cost of using the DBB will drop by an additional $2.6M as the build costs will have been completely amortized SPE Confidential 5 Sony Pictures Technologies – FY13 Three Year Plan Review SP Tech Showcase: Distribution Backbone The Results: . 80% of WPF deliveries are currently file-based . SPE is on track to utilize the DBB for 35% of deliveries this year and that will grow to near 100% within 2 years . The DBB’s ability to meet the shrinking timelines and increased volumes has helped SPT and SPHE fulfill the ever-increasing demand for SPE product around the world . Using the DBB, the cost for delivering 180K files in FY15 will be approximately $11M, saving the company $43M in costs over the next two years! SPE Confidential 6 Sony Pictures Technologies – FY13 Three Year Plan Review SP Tech Showcase: WPF Supply Chain Savings The Challenge: . Beyond distribution to clients, WPF purchases outsource services: . Dubbing . Subtitling . Editing for airlines, broadcasting, etc. Ingesting new assets for distribution – audio, video, metadata, rights management data . Etc. Volume and types of requests serviced by WPF are increasing . Technological advances in the industry have created opportunities to dictate workflows and drive cost savings . WPF manages a consolidated supply chain and workflows across divisions, allowing maximum leverage in defining workflows and, with SPE Procurement, leveraging purchasing power to identify potential time and cost saving opportunities The Solution: . Since FY10, WPF and Procurement have undertaken over 20 RFPs . RFPs are regularly renegotiated on a 1, 2 or 3 year cycle. On average, each RFP takes 2 to 5 months and are conducted on a global basis SPE Confidential 7 Sony Pictures Technologies – FY13 Three Year Plan Review SP Tech Showcase: WPF Supply Chain Savings The Results: . Of the 20 RFPS, 16 have resulted in annual savings of at least $1M . Based on actual volumes, the cumulative savings to the title owner since FY10 has been $57M Manufacturing Spend $150.0M 19% $57.0 $125.0M 17% $100.0M 15% $75.0M 13% $50.0M 11% $25.0M 9% $0.0M 7% FY10 FY11 FY12 FY13 Actual Spend Total w/o RFP Savings Percent Savings Annual Savings Cumulative Savings SPE Confidential 8 Sony Pictures Technologies – FY13 Three Year Plan Review SP Tech Showcase: Digital Entertainment Content Ecosystem SPE Confidential 9 Sony Pictures Technologies – FY13 Three Year Plan Review SP Tech Showcase: Shooting 3D on a 2D schedule and budget Conception Development Operation The Problem “The bottom line is, if you want to do Screen Gems good 3D, it’s very expensive. The 3D Systems Testing “Planet B Boys” feature shoots in 3D on camera equipment is expensive because • Speed of initial set up Screen Gems normal 2D schedule of 35 it comes with a lot of techs, the labor. • Ability to not need repeated days. Average 40 set ups a day, three […] And there’s a lot of tech fixes -- it’s adjustments rigs in simultaneous use. Only not easy shooting 3D.” • Time to change lens incremental cost of 3D is rig and three -- Michael Bay • Resilience to real-world handling crew members. Never waited for 3D. No 3D correction or conversion needed for rig footage. The Proposition With the right plan and the right Trial Runs SPT’s Left Bank Productions equipment you can shoot 3D on the Successfully shot episodes of “Happy Episode of BSkyB’s “Little Crackers” same schedule as 2D, with at most 3 Endings” and “Days of Our Lives” in 3D shoots in 3D in 4 days after one day additional crew and 3D post is primarily on the same schedule as normal. 2D training for crew. Incremental cost of 3D for adjusting depth to meet creative version taken from one camera on each is rig and two crew members. Producers intent. rig and aired as part of normal run. want to shoot more Sky shows in 3D. The Skills • Knowing what makes good 3D. Workflow • Experience with rigs. Colorworks designs near-set dailies • Workflows for productions from TV to system for “Planet B Boys”, footage major motion pictures stored and managed on Production Backbone. SPE Confidential 10 Sony Pictures Technologies – FY13 Three Year Plan Review SP Tech Showcase: Shooting with the F65 Conception Development Operation Camera Testing • Initial tests with Sony including two The Goal shorts developed Colorworks Sony’s new F65 camera produces capability stunning imagery with 45% more pixels “After Earth” • Lens tests – spherical and than its nearest competitor and a • The Colorworks designed near-set anamorphic dynamic range of 14 stops dailies system deployed in Costa Rica • Comparison tests for SPE and Philadelphia Technology Partners • Worked closely with production and • Work with Sony to improve camera Sony on F65 issues (e.g. data loss, The Challenge operation. fan noise) • New camera. • Work with FilmLight to produce tools • Footage managed and stored on PBB • Large amount of data. for dailies and DI. • Needs image processing tools. • Work with Otto Nemez (rental co.) on • Develop the skills to assist camera accessories and operation filmmakers “Smurfs 2” Workflow Development • Respond to production when The Skills Colorworks adds F65 support to near- Technicolor near-set dailies had • Practical experience with shooting set dailies systems, establishes problems and post for F35, Red Epic, Arri workflow on Production Backbone. • Footage managed and stored on PBB Alexa. • Workflows for productions from TV to Education major motion pictures. Partner with Production to train directors • Knowing how directors and DPs use and DPs on the F65.. cameras. SPE Confidential 11 Sony Pictures Technologies – FY13 Three Year Plan Review SP Tech Showcase: Better workflows for F65 productions Conception Development Operation The Proposition The F65 has more latitude than film so Partner with Screen Gems you can shoot with the camera just like Screen Gems wanted to shoot with F65 “No Good Deed” you would with film. because of camera characteristics and • xxx • No need for a Digital Imaging creating a 4k asset. Technician (DIT) or a video village • Saves cost, less to move, less reviewing on set • Reduce lighting costs using available Workflow Development
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