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The SPE Reel D FEBRUARY 2006 ISSUE 2 SONY PICTURES ENTERTAINMENT WANTS YOU TO KNOW IN GLOBAL MOTION PICTURE MARKETPLACE, SONY SPEAKS Contents MANY LANGUAGES 1 IN GLOBAL MOTION PICTURE Much of the focus of Sony Pictures’ motion The strategy was also intended to allow MARKETPLACE, SONY SPEAKS MANY picture production and distribution Sony Pictures the opportunity to work with LANGUAGES operations is on those films produced in the some of the most talented actors and United States. While awareness of these filmmakers in the world. Local language MICHAEL & AMY WANT YOU TO KNOW 1 operations is broad, many people don’t productions are intended for release in the 2005: The Year in Review realize that Sony Pictures is also the only territories where they are produced and, major studio to maintain stand-alone, local where appropriate, are distributed on a IN THE SPOTLIGHT 3 language motion picture production units wider basis, including the United States. Directing Sony’s Multicultural Vision throughout Europe, Asia and Latin America. In fact, Sony Pictures has been at the Gareth Wigan, Vice Chairman, Columbia 4 THE WORLD OF SPE: TriStar Motion Picture Group (CTMPG), DIVISIONAL UPDATES forefront of bringing local language blockbusters to the global marketplace. heads up this line of business for the Sony Pictures Television . .4 Company. He works very closely with Paul Motion Pictures . .4 Recognizing that the international market Smith, Executive Vice President, CTMPG, Sony Pictures Television International . .4 was growing faster than the domestic Worldwide Marketing and Distribution, Sony Pictures Home Entertainment . .4 market for theatrical releases, Sony Pictures Amy Pascal, Jeff Blake, the international Sony Pictures Digital . .4 launched foreign-language production marketing team headed by Sal Ladestro, and Studio Operations . .5 operations about seven years ago as a with production executives in our various Corporate . .6 strategy to increase the number of films territories. the Company makes and distributes. 5 INNOVATIONS (continued on page 2) Sony Shines at Annual CES 6 SPE’S BACK STORY Screen Gems: A Sony Institution since 1934 MICHAEL & AMY Want You to Know 2005: THE YEAR IN REVIEW the year in the number three position domestically, ahead of studios such as Disney and Universal, As we settle into a new year, we want to pause with over $1 billion in domestic box office to share a few thoughts about how we did in revenues. Overseas, our performance added 2005. We also want to talk about why we’re so almost another $1 billion. These are great optimistic about our future. accomplishments that deserve acknowledgment. Focusing on our motion picture performance, However, we know we can do better. Part of what we can’t pretend that 2005 was a great year. happened this year is related to the overall Although the first few months were strong, industry downturn. The entire industry is adjusting with hits like Hitch, Guess Who and The Exorcism to a changing marketplace, where there are more of Emily Rose, we then hit a slump that was and more distractions competing for the attention uncharacteristic of the way we have performed of the movie going audience. We’re looking at the over the last few years of unprecedented way we do business and adjusting where we success. While this slump was disappointing, believe we need to improve. it’s important to remember that we still finished (continued on page 2) 2 In Global Motion Picture Marketplace, Sony Speaks Many Languages (continued) Sony Pictures’ first local language production was a German film, Anatomie, released in 1998. The Company also launched Columbia TriStar Film Productions Asia in 1998. Overseen by Barbara Robinson, this production entity was responsible for, among other films, the Oscar-winning hit Crouching Tiger, Hidden Dragon, directed by Ang Lee, as well as the internationally acclaimed Not One Less and The Road Home, both from director Zhang Yimou. SPE’s most recent success in Asia was Stephen Chow’s box-office Two Sons of Francisco phenomenon Kung Fu Hustle, which has grossed over $100 million worldwide, and of a Brazilian singing and songwriting duo, The Incredibles and Star Wars: Revenge of which swept up the top awards at Asia’s is Brazil’s official 2005 Academy Award the Sith. equivalent of the Oscars. entry for Best Foreign Language Film. It’s also the highest domestic-grossing Brazilian Going forward, SPE’s expansion plans include In addition to its operations in Asia, SPE film of all time, outperforming in that Russia, where the Company plans to start a has produced films in ten other countries. territory international blockbusters such as program of films in 2006. Also, SPE is the European operations are now overseen by first major studio to establish an infrastructure Iona Macedo and have included Spanish, to support co-productions in India. The Italian and French productions. In the UK, Company plans to begin its first Indian film films include Snatch and, more recently, this year. As the market for Indian cinema Layer Cake. The Company’s production continues to grow internationally, SPE’s vast presence in Latin America has been focused global network will allow Indian film on Brazil but also includes Mexico. In producers to showcase their work outside their Brazil, for example, SPE most recently home market and acquire greater exposure for co-produced Two Sons of Francisco with their films. Hopes are high that this marriage local Brazilian production companies. between Bollywood and Hollywood will be a The film, which is based on the true story “win-win” for everyone. Two Sons of Francisco Michael & Amy Want You to Know (continued) Potential changes we’re considering include Sony Pictures Television entered its most At the end of the day, Sony Pictures is not only releasing fewer films in the years ahead, successful development season in recent about box office returns, critical acclaim, TV focusing on more event titles, placing tighter history with over 15 pilot commitments for cable ratings and product sell-throughs. We’re also controls on budgets, and looking at more and broadcast networks. One of these, Heist, about the people who make and sell the movies co-productions. has already been ordered to series by NBC. and TV shows, the DVDs, the special effects, and all of you who work tirelessly to make this We’re also very optimistic about our 2006 In Home Entertainment, the team worked place tick. It’s about everybody who makes film slate. The Da Vinci Code, which opens incredibly hard to ensure the successful Sony Pictures such an amazing and rewarding worldwide in May, looks fantastic and should integration of the MGM library into ours. Among place to work, and who makes us so proud to be one of the year’s true event titles. We also the MGM titles we began distributing on DVD in come to the studio each day. have a lot of confidence in other upcoming 2005 were The Amityville Horror and Beauty 2006 titles such as Casino Royale, Click, RV, Shop. Sony Pictures Digital began production on We have many reasons to feel good about how Open Season, and Marie Antoinette. We believe our first two animated features, Open Season we did last year, and even more reasons to be these films and the others in our slate will help and Surf’s Up, and they look great. Sony excited about the future. But, whatever hurdles us reclaim our marketplace dominance. We Pictures Television International had a fantastic and honors may come our way, we know that had an amazing run at the box office in the year with its distribution and its international through it all, we’re working with the best team three years before 2005 and we will again. production businesses, and it launched new in the industry. channels in Korea, Italy and Latin America. Take It’s also extremely important to remember the a look at the Divisional Updates in this issue of Here’s to a great 2006. remarkable achievements in 2005 of our other The Reel for more news. divisions here at Sony Pictures. For example, 3 IN THE Spotlight DIRECTING SONY’S MULTICULTURAL VISION In countries around the world, Gareth Wigan brings local films to life through Managers, the filmmaker knows that SPE SPE’s local language production units has the machine to get the film distributed elsewhere in the world. The visibility that this provides filmmakers, and the contacts it allows them to develop, is invaluable. Gareth Wigan is Vice Chairman of the Columbia TriStar Motion Picture Group (CTMPG), a position he has held since 1997. We also provide value on the creative front. While Gareth works closely with Amy Pascal and the motion For instance, there are many examples of picture management team on a variety of creative and operational things we may not understand in the matters, his primary focus is on overseeing SPE’s local language United States that are very meaningful to production programs. Gareth recently shared some of his local populations, and you can spend a thoughts about this line of business. lifetime learning about that. What I try to say to filmmakers is, “I can’t tell you what will work better in your country, but I can share a Western perspective on what will work in the United States and Europe.” I try to work with them to determine What prompted Sony Pictures to get into The Company plans to expand its whether there may be another way to say the local language production business? production presence into Russia. something that will still achieve their vision About seven or eight years ago, it became Why Russia? but that may be much easier for a broader clear that there was a growing appetite in We anticipate that movie attendance in audience to understand.
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