CFO Rob Wiesenthal talks up EMI publishing buy
Sony Corp. of America’s chief financial officer Rob Wiesenthal said Tuesday that now is certainly not the time, if there ever was one, for the Japanese giant to split up its various businesses.
Rumors that Sony plans to spin off its entertainment unit in particular do the rounds every few years. But Wiesenthal told the UBS Global Media and Communications conference in Gotham — in response to a question – that the sprawling company has finally started to see the results of a more productive working relationship between its various fiefdoms. Collaboration among divisions is something chairman Howard Stringer made a priority when he took the top job in 2005 and it’s been tough going, as has, in general, turning around the electronics behemoth.
The core electronics manufacturing business is struggling. But Wiesenthal noted that Sony is approaching $1 billion in annual revenue from PlayStation and Sony Entertainment Network.
In its most recent deal, Sony Music along with partners acquired EMI’s music publishing unit for $2.2 billion. Sony/ATV Music Publishing will oversee the operation but it will be remain separate. “We’re big believers in music publishing and we have been for a long time,” Wiesenthal said. It’s much less sensitive to piracy than recorded music since only 18% of revenue comes from CD sales.
The deal will give Sony ownership of two million songs. It hasn’t announced strategic plans yet for the expanded biz. Wiesenthal cited cost efficiencies and revenue opportunities. “But it is a separate company. There’s lots of talented management at EMI,” he said.
On the recorded music side, he said services like Spotify continue to offer consumers ways to pay for music and that the industry is starting to “see the light at the end of the tunnel.”
He’s not worried about Universal Music’s added heft after acquiring EMI recorded music in a deal announced the same day last month.
“I think we’re a pretty nice-sized music company,” he said.