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Sony Lays Off 12 at Crackle; More Cuts Likely Coming in TV, Film Units (EXCLUSIVE)

Home entertainment expected to be folded into TV division

Sony Pictures Entertainment chairman Tony Vinciquerra is continuing to streamline the studio with a series of new cost-saving cutbacks and realignments across its television and movie divisions aimed at improving the bottom line.

As part of the overhaul, Sony plans to fold its home entertainment department into its television arm, which, according to sources, will likely result in a headcount reduction. Sony signaled that change back in February when it announced that TV distribution president Keith Le Goy would be assuming oversight of home entertainment. As part of the shakeup, three president-level executives–international channels chief Andy Kaplan, chief FV marketing officer Sheraton Kalouria and home entertainment topper Man Jit Singh, were let go.

Sony is also planning to cut layers in its film operations. Currently under the microscope for a restructuring and potential staff cuts is theatrical marketing. Marketing and distribution president Josh Greenstein is conducting a top-to-bottom review of the division to find ways of making the marketing group more efficient and globally-oriented, say people familiar with the matter. Last month, domestic marketing chief Christine Birch was forced out. She is yet to be replaced and it is still to be decided whether her successor will come from within or outside the studio.

Over the past week, the ax already fell at Crackle, Sony’s ad-supported streaming service, with a total of 12 employees being cut. The division, which began as an SPE acquisition in 2006, is restructuring its business, merging its digital ad sales and ad solutions divisions. Two of the ousters were a senior VP and VP level within digital media sales; the reconfigured department will now report into an SVP on the ad solutions side. Crackle also has a games division that is losing a VP due to the layoffs and being consolidated with its partnerships and data departments into a new unit.

Sony does not break out financial results for Crackle, which is still pushing full steam ahead with the slate of original programming it pitched to advertisers in April at its NewFront presentation, including a renewal for the 50 Cent-produced drama “The Oath.” Eric Berger, who oversees Crackle as its GM and chief digital officer of its networks division, touted 50% ad revenue growth over the past five years at the presentation.

A Sony spokesman would not comment on any pending headcount reductions, but gave the following statement to Variety:

“Tony has made no secret of the need to strengthen the studio’s overall performance since taking over SPE, and has asked all our business units to explore ways in which we can achieve that. We have made great strides in our turnaround efforts to date – especially on the film side this last year, with our most profitable slate in a decade – and we are continuing to build on those gains.”

After a prolonged box office slump and lagging market share, the movie operation, under the leadership of chairman Tom Rothman, has begun to see its fortunes rise recently with the global blockbuster “Jumanji: Welcome to the Jungle,” which grossed $946 million, “Spider-Man: Homecoming,” which sold $880 million of tickets worldwide, and “Peter Rabbit,” collecting $331 million.

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