SONY PICS CUTS JOBS, CANS 450 EMPLOYEES

Sony Pictures Entertainment is slashing its workforce by 6 1/2 percent, the studio said Monday. The studio began notifying the roughly 450 people who will be affected by the layoffs, with most being done by the first week in March.

EMAIL SOURCE: NIKKI FINKE

This email went out to staff today:

From: Michael Lynton and Amy Pascal
Sent: Monday, February 01, 2010 2:58 PM
Subject: Transforming the Studio

Dear Colleagues,
In our article in The SPE Reel in December, we
spoke about the shifting landscape of entertainment and its impact on the
economic model at the heart of this industry. Despite the records our studio set
at the box office, we’re not immune from these forces, and we said then that
costs needed to be controlled as part of a sustained and strategic effort to
remake Sony Pictures for the future.

Since that time, in all-hands meetings
and small groups, our division heads and executive team have been in touch with
many of you to talk in more detail about the transformation of the studio and
the kinds of changes being considered.
Last week, the first steps towards
the creation of a new operating model for our studio were taken in our home
entertainment division and the IT department.
Today, we want to let you
know, in a timely manner, what will be involved in the crucial – and difficult
-- next phase of this process.
In several stages, we will have a workforce
reduction, with most of the notifications taking place by the first week in
March. It will affect each of the studio’s divisions, with the majority
occurring in home entertainment and IT, and in the United States.
We do not
have final numbers or specific dates for all reductions now, because decisions
regarding proposals for certain international offices are pending. Local laws
will be governing a consultation process with employees in those locations.
The decision to take this step was difficult. But it’s being done in the
context of a strategy designed to help us safeguard our competitiveness and
chart our own course through these troubled waters.
The need is clear: from
the growth of online piracy, to the social media effect on the performance of
films, to the way people have changed how they watch television and acquire
DVDs. The business is going through a rough period of trial and transition, and
we have an obligation to take the steps necessary to get through it.
As we
said in December, we are grateful to everyone at Sony Pictures for helping us
meet the challenges of this time in our history from a position of strength. And
we are confident that the changes we’re making, as difficult as they are, will
keep us on a path toward greater success in the future.

Michael and Amy”