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This is the message which was sent this afternoon to Sony Pictures Home Entertainment staff. In addition, in IT, CIO Rick Hopfer is leaving, and Steve Andujar of that department is replacing him.
From: Bishop, David
Sent: Wednesday, January 27, 2010 2:03 PM
Subject: SPHE Changes
We announced to you in December that SPHE is conducting a review of our organization to proactively confront the changing economic model in our industry. Our choice is simple – we can make strategic choices today to direct the evolution of our business, or be overwhelmed by changes that are imposed on us by forces outside of our control.
We’ve chosen to act now to meet the shifting demands of a fast-changing marketplace. We’re building a new operating model that will streamline decision-making, increase accountability and innovation, and focus on strategic and analytic thinking. As a result, we will maximize our speed and flexibility – attributes that will be critical to SPHE’s growth and prosperity in the years to come. Many of you have been engaged in this process, and we thank you for your participation and ideas.
In the short term, this effort will require us to make hard decisions and begin to transition to this new model for our business. As a first step in this process, I have restructured my executive team and wanted to let you know about these key changes:
· Emphasizing our new business model’s focus on innovation, John Calkins will transition from his current role in SPE Corporate Development to a newly-created position within SPHE as Executive Vice President of Global Digital and Commercial Innovation. This new team will focus on developing and implementing strategies to maximize new technologies. Our current SPHE Business Affairs and Worldwide Digital Distribution groups will now report to him, and we look forward to him joining SPHE. As part of this transition, Bob Rubin will be leaving SPHE. Bob has been a strong asset to our team, and his guidance and counsel will be missed. In addition, Sean Carey will be moving on from SPHE to another position in the Sony family. We want to thank him for his years of service to Sony Pictures and wish him well, and we all look forward to working with him going forward.
· With the increasing importance of operating as a global entity, and to particularly recognize the significance of our European region, John McMahon will now report directly to me. John has added tremendous value to the business in the year since he transferred to SPHE from SPTI, and I look forward to working with him more closely in the future.
· Recognizing the need to streamline our commercial operations, Matt Brown will add oversight of the North American sales operations to his current role managing the rest of the international business. As a result of this move, Marshall Forster will be leaving the company. Marshall has been with SPHE for over 17 years and managed the North American business during a time of tremendous growth. I would like to personally thank him for all of his efforts during this time, and I know you will join me in wishing him the best for the future.
· The Advanced Technologies team headed by Don Eklund will move out of SPHE into the Sony Pictures Technologies group under the leadership of Chris Cookson. Don will continue to be a valued resource for SPHE, but his role will expand into other areas.
· These reporting changes are effective immediately. For an organization chart outlining these shifts, please click here.
Those who are leaving the organization will not be departing for a few weeks and will be available at your request to assist in any transition matters.
Change of this nature is always difficult, but successfully adopting new strategies and processes is imperative for business growth and success. We will continue to keep you informed of our change initiatives through our already-established communications channels and will update you as more details are available. We currently anticipate that our new operating model will be fully in place by the beginning of April. In the meantime, I ask for your continued focus on our work during this period of transition.
As always, please feel free to talk with me or any other member of the executive team about any questions you may have.
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Well sure we’re making money hand over fist but the fact that the rest of the country is in the economic shitter gives us an excuse to fire people… it’s awesome!
They sound so incredibly creative, don’t they? Sigh.
I remember David Bishop from his years at MGM/UA, where he used and then backstabbed a friend of mine like the middle management scumbag he apparently still is. How like Hollywood to see he’s still rimming corporate assholes for six figures while the unwashed masses get outsized in the name of “new strategies.”
at MGM david had his “hit man” to do his dirty work. Marshall, without a personality, was unable to face anyone, anything or to move the divison forward.
least Ben F (past pres) had “b*lls”
Not meant to speak ill of anyone else, but nice to see a genuine class act like Matt Brown making his way up.
agreed, Matt’s the real deal. what will the domestic team do now with a decent guy in charge? the old MGM crew at SPHE won’t know how to behave.
i’m sure Matt will continue do what’s right!
This could be so much shorter if they just said, “Bend over and spread those cheeks”.
That’s why the big boys get the big bucks. They so eloquently tell you that ‘you’re fucked’.
The only thing they omitted is the new team is probably flying off to Tahiti for strategy meetings and spiritual enlightenment.
Thank you for brightening my day just a little.
Well if this is SPHE focused, then the Box Office header note doesn’t apply. Home entertainment is in a complete flux industry wide and the model needs to be adjusted. Who knows what cost structures are needed but it needs to be rebooted. Post production is in the same bad spot. Margins are gone bit the cost structure remains. That needs to change too.
One more example of failing your way to the top.
Bishop should have hired Clooney to humanize his cold yourassisgrass release.
Here’s hoping the next Spider-Man bites.
I realize the original cast is aging and production costs for the next one were probably as huge as the national deficit, but I expect the next one to suck balls. How do you replace Macguire as spiderman!!!
But all three Spider-Man movies already suck. I’m sure they’ll find a way to make it even worse.
the blood bath is about to begin, probably twice this year
“We will continue to keep you informed of our change initiatives”
Codewords for next weeks memo: “Screenwriters with MBA’s will “transition” to the front of the line”.
It’s so much worse than that. The new paradigm is “screenwriters with half-million dollar quotes but who are now willing to do the first draft on spec” go to the front of the line.
I recently had to have six meetings to get a job, and when it was down to three of us (all successful, produced writers), they asked for a treatment from each of us. Unpaid. I walked. It’s been 15 years since I had to write for free and I’m not about to start now. The other two turned in treatments, one of which was 20 pages, and neither got the job. The project is now “on hold.”
So glad my union went on strike for this.
Rick Hopfer is a classy guy, real leader. Loved by most. We hate to see him go. But Steve Andujar plays golf with Dave Hendler, the Sony Pics CFO. Guess that worked out great for him!
They need to bring Ben Feingold back!
From: Hopfer, Rick
Sent: Wednesday, January 27, 2010 1:06 PM
Subject: Announcement
SPE’s Information Technology team has begun to implement a series of changes in the U.S., and to explore the strategy for our international operations, in efforts to help our business keep pace with the economic and cultural shifts in the entertainment industry. More than ever, these external forces will require us to innovate, to cut costs, and to make changes in the way we do business.
With that spirit of change in mind, I would like to announce that I have decided to leave Sony Pictures. As this team embarks on its new phase of evolution, I felt it was the right time for me to pursue the next chapter of my personal journey as well. You will receive a message from David Hendler later today with more information about the transition.
It has been my extraordinary pleasure and honor to lead this team for the past four years and to have served as a member of the group for eight. We have made great strides together, and I’m proud to leave you in position as a strong and valued partner to the businesses you serve.
Best wishes,
Rick
Macup is correct, and both the FT and WSJ have run numerous articles about how the falling DVD/Blu-Ray (combined) revenue has hit Hollywood’s margins hard. “Hollywood Economist” and “Big Picture” author Edward Jay Epstein calculates that in the 2000’s studios made about 82% of revenue from home video and TV rights sales.
BOTH have been hit hard by the recession, which has meant lower (particularly TV) ad rates and delayed adoption of expensive Blu-Ray, still at only ~10% of home video sales. You also see REDBOX as the most explosive growth (98% over the previous, admittedly tiny base from 2008) in 2009. The $1 rentals are profoundly threatening to Hollywood.
If people can be persuaded to simply wait a few months and see the same movie, at a fraction of the cost, Hollywood collapses for almost everything but date night, box office wise, and their margins on the MAIN PART OF REVENUE simply disintegrate.
Sony was supposed to be the “it” company with Stringer creating Apple-alternative Ipod/Iphone products integrated tightly with Sony’s library. Now the company that created the Walkman is me-too with pretty much everything and faces loss of the cash cow: home video.
Yeah the release is BS, how “creative” can you be when consumers seem willing to switch to $1 rentals? Its just re-arranging the deck chairs of the Titanic. It isn’t just SHE either. Everyone else is in the same fix.
The blood bath is only just beginning. More restructuring and layoffs to come. There will be cuts across the studio with home entertainment getting hit the hardest.
PF above is off base. Bishop is a decent guy and a good manager and his people like him. Home Entertainment divisions all over town are facing a tough patch and we should expect more news like this as all the studios struggle to navigate a sharp decline in disc sales and a not-rapid-enough transition to other models of distribution. There’s a bad moon on the rise.
other than the rediculous Scan Based Trading program that puts blu ray & dvd in waaaaaaaaay too many store fronts but screws the best retailers (just wait til Wal Mart & Best Buy demand it), David’s offered nothing to SPHE.
a nice guy yes, but his skills are far below Presidential level (and is his character)
his days are numbered too.
Every asshole CEO in town is crowing, “THE BEST YEAR EVER!” “BIGGEST GROSSING YEAR EVER!!” “HIGHEST IN HOLLYWOOD HISTORY!!!” Hey – fuck these words. You heard what I said.
Under these headlines, we’re seeing the firing of hundreds of people at every studio.
It’s astonishing the piggish, insatiable appetites the studio heads have. What greedy, back-stabbing monsters: BOB IGER, JEFF BEWKES, BARRY MEYER, ALAN HORN, and the rest of the rotten gang. You have to wonder how exactly they were raised to come out this avaricious…
I’d sure like to know if they were born this way, or was it learned?
How these companies can continue to tout record box office and do this stuff is no different than Wall Street lavishing bonuses while posting record profits and taking no losses on their bad dealmaking.
They are still making a ton of money (more at the BO than ever), down a bit from an ass-ton of money so “none for you” is what they are saying.
this is sony HOME entertainment, they do not get credit for box office. they get blame for nobody buying or renting dvds. if people were purchasing the movies for their HOME things would be different.
that’s true
Not only are they laying off a bunch of people…. they’re currently planning to send a bunch of the IT jobs over to India because the workers there are willing to try to do the job for a lot less than the current workers. Sony Pictures is willing to take your American dollars for their product but they’ll be damned if they’ll pay American rates for the job to be done. The economy won’t improve with “leaders” like this.
Way it goes, folks. The studio system has been a bloated mess for 30 years and the reckoning has arrived. For those of us on the creative side of the business, this is good news/bad news.
Good news that decision-making will be streamlined, reducing the layers of “creative execs” who are actually clueless MBAs that wouldn’t know a good story if it got them through the door at Villa.
Bad news that there won’t be as many stories told, and those that are will be more of the same, soulless blockbuster-type.
Sounds to me like it is…”Reality Show Time”. Say good-bye to your jobs crew people.
Rick Hopfer’s departure paves the way for even more changes in the IT Division of Sony Pictures.
Word has it that a major outsourcing contract has been penned with an India based firm. Sony Corporate is already in full swing with it’s plan to eliminate nearly 80% of it’s IT work force, both in New York as well as California.
It’s not long before Sony Pictures follow suit.
This is only the beginning to the loss of jobs in Hollywood and Califorina.
SPE got rid of 300 jobs last year around this time. Look for more layoffs to come over the next several months as the outsourcing transition moves forward under Andujar.
Hopner is a class act.
After having spent more than two years working at SPE, I can say that Rick IS a very class act. Steve is no slouch either however. But the dead weight at the studio in total needs to be removed. painful as this is – this is the only way that will happen. I’ve also worked with Hendler at Disney – he’s tough, but knows his business . . .
I guess by April India will be playing a large part in maximizing SPHE’s speed and flexibility. I hope Wallmart is on board with the “new English”. Great innovation, and focus on strategic and analytic thinking. Give away jobs that US citizens desperately need. F that.
From: Office of David Hendler/LA/SPE
Sent: Wednesday, January 27, 2010 2:25 PM
To: Hendler, David
Cc: Andujar, Stephen
Subject: Announcement About Steve Andujar
As you heard earlier today, Rick Hopfer has announced that he will be leaving the company. Rick has guided the IT function through a period of tremendous technological change and growth, and I would like to personally thank him for all of his efforts. I know you will join me in wishing him the best for the future.
Looking forward, I’m pleased to announce that Steve Andujar will be promoted to the position of Chief Information Officer effective February 1. Steve brings to the role more than six years of experience across many parts of our business – including his leadership of the global SAP implementation (our largest system deployment to date), his time as Division CIO for the Corporate groups, and his current role as Division CIO for the Motion Picture Group, where he oversaw the development and implementation of Spirit World, which supports theatrical sales and distribution efforts in 23 countries.
In addition, Steve’s deep expertise from previous posts – including Vice President of Information Technology at Homestore, where he led the build-out of the enterprise systems infrastructure from startup through $500 million in revenue and coordinated IT integration efforts for more than a dozen acquisitions; and Vice President of Corporate IT at Pearson Publishing, where he oversaw numerous enterprise technology initiatives including the implementation of SAP financials in the U.S. and abroad – make him an ideal person to take SPE’s IT function to the next level of success.
I am confident that Steve’s leadership, together with the dedication and professionalism each of you bring to your roles, will bring this team through the transition stronger and more resilient than ever.
What the hell does this mean?? Outsourcing all of IT makes things more “resilient”??
Guess I’m out of a job soon.
These people are nuts if they think oursourcing to some company in India will solve all their problems.
Good luck to them.
I’m out.
Well, as someone who went through the same “boot-up-the-ass” “change is for the better” b.s. a few years ago under the guise of a “reorganization” directed by Rick Hopfer, all I can say is “what goes around comes around!” Rick is a schmoozer and an ass-kisser just like the rest of them (how do you think he’s held on to his job for so long?). I’m sure he’s leaving with a sweet deal that the other Sony minions can only dream about, so you won’t see me shedding any tears as he drives off into the sunset to his multimillion $ house in Malibu! And as far as Andujar goes, well, the countdown begins now for him, too. That job has a definite shelf-life! Just ask Rick, John, Justin, Steve and all the others who came before them. Actually, Rick lasted longer than most, so Kudos to you Rick! Guess you’re not a bad golfer yourself!
Here’s what I think. Why doesn’t the whole damned studio pack up and move to India?! The rent will be way cheap. All that “for you, almost free” labor. Man, it will be groovy. No friggen US taxes, no 401k matching, no profit sharing, no insurance, and it is totally cool to treat your workers really bad. Woohoo! Gettin fat and juicy on the backs of the poorest. F**k Hollywood. Les Go Bollywood!
The full movement of SPE to India has been in a work for some time. http://www.setindia.com/
They should be fully relocated by 2012.
David’s managed to once again blame others for his lack of mgmt skills and vision… just wait until WalMart / Best Buy demands the Sony scan-based bluray & dvd sales program.
at least Matt will bring some personality to the domestic team as the home entertainment business declines. we wonder if Marshall’s brother, Derrick, in Canada will suffer the same fate?
Only saving grace is if the tax benefits of outsourcing go away. So far Obama has only said the words; I have yet to see it in action. That plus the fact that multi-national corporations can get around domestic laws, and there is no solution to this in the near future. Get your resume ready and clear your desks. Part that sucks is that the “lucky” ones who will end up selected to stay are the ignorant tools that will do anything to save their jobs, i.e., backstabbing, false pretenses and all. You know who you are. Oh wait you don’t cuz you”re an ignorant tool ahhahaaaa
I completely understand Home Entertainment getting re-organized, but why IT and why again? Last year around this time SPE let go about 300 people, seveal from IT. Many of my good friends lost their jobs.
The IT department went from thin to even thinner. I doubt that they will save any money. It’s not like the salaries and bonuses of everyone they plan on letting go can justify the multi-million dollar outsourcing contract they’ll have to sign.
Before long they will have to bring it all back in.
It’s a cycle.
Sad that the real people that need to go are the ones at the top making all the money. This place is so top heavy it’s a joke. Everyone there is a director or executive director or vice president of something or another, but they don’t manage anything or anyone.
Why is it that the people that do the work are always the first to go?
Great posts from above! Here’s the scoop:
-Sony Pics did not cut enough last year. 2.5% cut in this economy is just not enough. So the cuts go on. And even 6.5% announced today is not enough. The company has around 50 Presidents. Double that for EVPs, 4X that for SVPs, and 8X that for VPs. That’s serious overhead. Home Entertainment can no longer support that level of fat.
-Getting rid of Sean Carey, Marshall Foster and others was a good start. You can fire 35% of the execs here and operations will not be dented one bit. Now let’s look at SPHE Marketing and the MPG Marketing groups.
-The IT department has a lot of bloat. Just show up to Corporate Pointe on any afternoon after 3pm. You will find people pretty much asleep at their desks, staring off into space, and other packing up to go home. They are not stretched thin. 50% of the IT staff needs to go. The other 50% need to be offshored to Cap Gemini or IBM. Hopfer just wasn’t engaged with the process, and Andujar does play good golf!
At this exact moment I can go to any street in downtown L.A. and get a copy of any movie up for best picture – including AVATAR!! Not cheap video cam stuff, but actual HD quality copies. How can anyone make money?
I completely agree with SPEDude. There are so many people there with upper management titles doing nothing but collecting a bonus check every year.
The IT Dept is the worst because they get paid more than people with the same title on the business side. I know of several people in IT that aren’t worth keeping around, but somehow they manage to stay. People that I’ve heard continue to get negative reviews and are constantly moving from department to department, position to position, trying to stay ahead of the ax. But they are completely worthless.
In IT, contractors that work here for years are converted to permenant and get a title bigger than the person they worked for previously. I know of someone that was a contractor reporting to a Director, but when he turned perm, he got a title of Director also… but still does the same freak’n job he did as a contractor. How does that happen?
Sony Pictures needs to get rid of all their VPs, EDs and Directors. They would save millions in salaries, benefits and bonuses. Trust me, they won’t miss any of them. Leave the frontline managers and their staff who do the REAL work alone.
I disagree with SPEDude that the people in IT are lazy. I work in IT. I work my butt off trying to keep these old systems running day in and day out. It’s just sad to see the wrong people get the credit and save their jobs on the backs of the people that do the actual work.
450 people is a good start. They’ll definitely need to trim more to be profitable.
And you can start with Michael and Amy.. “Co-Chairman” why?
It’s easy.. get rid of one. Duh….
With outsourcing comes less control and more bloat. IT has not been central to their business model, but more and more digitalization needs to happen. The truth is they do not have the right mix of people to do the job and way too many executives and managers that do not have a clue spending most of the day trying to keep their jobs by smoozing with each other. It is a lunch culture, not about doing the job or being creative, but who likes you and who is your lunch buddies.