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Lights! Camera! Balance Sheet!


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LIGHTS! CAMERA! BALANCE SHEET!

It's power-lunch time at the Rita Hayworth dining room on Sony Pictures' Culver City lot. Danny DeVito trudges in. Nearby Alex Trebek, host of the TV game show Jeopardy, holds court. All but oblivious to the high-voltage networking, studio President Alan Levine hunches over his pea soup and discusses the motion picture industry's byzantine accounting rules.

A onetime business attorney, Levine is the antidote to Sony Pictures Entertainment's old regime. The studious, low-key 49-year-old executive isn't spinning grand plans like his predecessor, the hyperkinetic Peter Guber. And that's O.K. by Sony Corp.: It was Guber's disregard for fiscal realities that led Sony through five years of self-indulgent extravagance, big-budget bombs, and rarely realized ambitions.

BIG LOSS. Since taking over in October, 1994, Levine has gone a long way toward restoring the Sony name in Hollywood. The film and TV operation is finally running like a business. After pushing the parent company into its first-ever loss in 1994, the studio has had five consecutive profitable quarters. For the fiscal year that just ended, it earned more than $200 million on revenues of $3 billion.

Most of Levine's profits come from a TV unit that is syndicating such network hits as Who's the Boss? and Married...With Children. But average film costs are down as well. And even if Sony still lays the occasional egg, like Mary Reilly, it also boasts such low-budget hits as Sense and Sensibility and The Craft. Moreover, the studio is showing unaccustomed restraint: It teamed with the Walt Disney Co. for the costly Starship Troopers, and it halted plans for a Godzilla remake when the budget came in at $130 million.

But what of the company's future? Unlike Guber and Michael P. Schulhof, the former chairman of Sony Corp. of America, who openly courted networks and cable companies and even contemplated purchasing the Los Angeles Kings hockey team, Levine demonstrates only modest expansionist tendencies. He is no longer trying to cement a distribution partnership by selling off a slice of the company to a cable operator or a broadcaster, for example. More likely now, report knowledgeable sources, Sony will spin off a piece of the studio in a public offering within a year to raise cash.

Meanwhile, Levine presses ahead quietly. The Game Show Network, launched last year to milk Sony's trove of game shows, has been accepted slowly by cable operators. Sony has also launched overseas cable channels from Latin America to India to broadcast Sony movies and TV shows.

Most promising, Levine is aligning the studio with CEO Nobuyuki Idei's digital vision. The Imageworks unit, which makes TV commercials and special effects for Sony and other studios, is also working on exotic software "interfaces" for Sony's new computers. Idei likes to visit Imageworks when he's in town, and Levine doesn't mind giving the boss studio tours. He can show off some dazzling technology, stars such as Jim Carrey--and best of all, a clean balance sheet.By Ronald Grover in Culver City, Calif.


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