I didn't cite him in my story. Clooney's stuff was all over the Internet -- reported by a number of Hollywood pubs, and oh, not to mention Wall Street Journal.
I am not sure if Clooney is nuts (I actually have a lot of respect for some of the movies he made), but my point was to bring in some "Hollywood" voice in the "conversation" we are having in this forum. We should have some fun, shouldn't we?
Junko, I know I'm late to the game here on this trail but I had to weigh in on this one. Please tell me that I didn't just read that you're trying to seek validation from George Looney...ahhh I mean Clooney. I really respect your reporting on world events from a first person perspective and I'd like to think that I can continue to respect your takes on that and other topics. But he's nuts, and siting him for validation on anything except your side ambition of mastering mono-dimensional acting and bad manners is unbecoming of your journalistic standards.
Yesterday's news headline states that the "Sony Rejects Loeb Sale Proposal". [No, I will continue to refuse to put the punctuation mark inside quotes when it was not there to begin with!]
Specifically, Sony's board has unanimuously rejected a U.S. hedge fund manager's [Third Point CEO Daniel Loeb] proposal that it sell part of its entertainment business. Sony maintains that continuing 100% ownership of both parts of its business sectors is 'fundamental" to the company's success... [yak, yak, blah, blah, yahdy, yahdy, yahdah...]
Although Sony's board rejected the idea of spinning off the entertainment business "for many reasons," that may not be the end of the story. As The New York Times notes, this could lead to a public debate over the idea. The Times story quotes Loeb, who owns 7% of the company, as saying he looks forward to an "ongoing dialogue" with the board. (I suspect we'll see some sort of open letter within a week.) In any case, it's good that the company will increase its financial reporting on the unit so that investors can better evaluate the company. Either way, I'm sure both divisions will continue to do great work.
No split for Sony, according to this news release: Sony Corporation Sends Letter to Third Point. In the press release, Sony says they sent a letter to Third Point LLC (the hedge fund founded by Daniel Loeb) reaffirming that "...the Board and management team strongly believe that continuing to own 100% of the Company's entertainment businesses is fundamental to Sony's success, and that a rights or public offering is not consistent with the Company's strategy for achieving sustained growth in profitability and shareholder value."
But in truth, Clooney is peeved at something different. Clooney never addressed whether a hardware company like Sony should also be involved in the movie business. Clooney's beef with Loeb was Loeb's badmouthing the movie business end of things. That's all.
Apple may not be producing entertainment content, but they too got involved in more than just making the hardware. With iTunes, they also became a store for content. Some of the Apple faithful like to claim that Apple "reinvented" the recorded music industry by doing this, for example.
Hard to say that diversifying one's business is "wrong," but on the other hand, both Apple and Sony seem to have a cult following that tends to take any criticism of these companies like a personal affront. It's certainly indisputable that when one part of the business takes a hit, it will feed off the profits of the part of the business that is doing well. That's why diversification makes sense from the company's perspective, wanting to survive, and perhaps not from a hedge fund manager's perspective.
KB: You raise a very good point. Sony may be among the most unmanageable companies in the world right now. I would hope the board would be keenly aware of that, and will act appropriately. Each part might perform better on its own -- that is, by focusing on its own core business. The net effect could be good for everyone -- shareholders, consumers, and employees.
Pseudoid: Oh, you just reminded me that I got suckererd into buying a mini-disc recorder at one point. Shame on me. But yes, it does reflect on Sony, too. I still think it's a brilliant hardware company, but it seems like it's been looking for its next big thing ever since the iPod overshadowed the Walkman.
Clooney's remark might make sense in terms of an industry problem of not supporting independent art, but it seems a poorly calculated artistic fist-shake against 'the man' that doesn't take into account the consequences of what Loeb is trying to accomplish. If the CE division is cannibalizing entertainment's profits, maintaining the monolithic Sony empire only results in less reinvestment of those cannibalized profits into the entertainment industry so there's room for the failed, 'art for art's sake' projects he wants to save. The disappeared note about implications of Sony's empire on LG and Samsung's media aspirations, as though following the Japanese example were the only way Koreans could succeed in media, is just wrong, both factually and in it's arrogance.
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