Int'l strategy shift spurs Sagansky exit
Citing an unacceptable shift in Sony’s international business strategy, Sony Pictures Entertainment co-prexy Jeff Sagansky announced his resignation Monday, effective immediately.
“The terms under which I accepted this assignment almost a year and a half ago have changed,” Sagansky said in a statement. “Sony Corporation has stated its desire to reorganize our international business in ways that are different from my understanding. Under the circumstances, I believe this is the right time for me to leave.”
Sony made clear its desire at a Feb. 5 board meeting in New York to shift control of its international strategic business division — which had been under Sagansky’s watch — to the worldwide headquarters in Tokyo.
Sagansky, 46, said that Sony Tokyo, wanting to take a more “hands-on approach” to its international business, would end up reorganizing the whole international operation.
“Until now, the vision and approach of international has emanated from the studio. That’s where the expertise resides. They want to go in a different direction,” Sagansky said.
“In my own mind, it would have really compromised my effectiveness and ability to do the job.”
It was unclear how Tokyo’s desire to take greater control of Sony Entertainment initiatives would affect the position of New York-based Sony Corp. of America exec Howard Stringer, who explores technological and business opportunities for Sony Corp.
Surprised by exit
Sony execs were reportedly surprised by the abruptness of Sagansky’s move. Rumors have abounded over the last year and a half that Sagansky would ankle the corporation, ever since he shifted from his Sony Corp. of America exec VP slot to return to L.A. to handle Sony Pictures Entertainment TV and international business chores. His name had previously been bandied to take over as chairman of Sony Pictures Entertainment before SPE prexy and COO John Calley was named in the fall of 1996.
But associates say Sagansky had been more invigorated by his job than ever before. They referenced his eager initiation and participation in Sony deals to acquire Telemundo and the Cineplex Odeon/Loews merger.
One source explained the decision as Sagansky’s reluctance to accept a role in which he was unable to make independent decisions on strategic opportunities.
“He didn’t want to simply identify opportunities,” said the source. “He wanted to identify them and then decide whether to implement them.”
That ability now would presumably be left to Sony Corp. execs in Tokyo.
Second division move
The shift marks the second major division that Sony will have moved under Tokyo’s immediate supervision. Carl Yankowski, former prexy of Sony Electronics, ankled the corporation a few weeks ago and was replaced by a Tokyo-based Sony management exec.
At Sony, Sagansky was responsible for SPE’s worldwide TV operations, any international growth opportunities as well as studio corporate development and strategic planning.
His departure also leaves a dent in Sony Pictures Entertainment’s corporate structure, which restructured itself 17 months ago. In that time, Sagansky has worked hand-in-hand within the fearsome foursome that also included Calley, co-president Bob Wynne and exec veepee Yuki Nozoe.
“I am very proud of what we have accomplished together at SPE in the past 17 months,” Sagansky said. “In that short time, we have been able to effect the Loews/Cineplex Odeon merger agreement and, pending regulatory approval, the Telemundo acquisition, as well as achieve record performance in our TV and film businesses.”
No replacement named
Sony made no announcement about a replacement for Sagansky. Calley said that would take some time. “We have to focus on what our common strategy is with Tokyo,” he said. “Then we’ll figure out how to execute it in terms of personnel.”
Sagansky has no immediate plans, but said he would begin thinking about “what I want to do next.” The question also remained whether Sagansky, who left of his own volition, will get a settlement package.
Sagansky’s resignation will be the second time he has left a Sony-based company. He was prexy of TriStar Pictures from 1989 to 1990, and before that he was president of production there for four years.
In between stints at Sony companies, he was president of CBS Entertainment, overseeing CBS’ ratings rise from third to first place in one year.
He joined Sony in September, 1994 as exec VP of Sony Corp. of America, responsible for Sony Retail Entertainment, Sony New Technologies, SW Networks, Psygnosis and new business development, such as the launch of Sony Playstation.
After former Sony Corp. of America president Michael Schulhof stepped down in early 1995, Sony Tokyo diminished the division’s jurisdiction and reassigned Sagansky to handle SPE matters.