Sony's Tokyo HQ taking greater role in Hollywood studio after furor

TOKYO/LOS ANGELES (Reuters) - Sony Corp's Tokyo headquarters is changing its usual arm's-length relationship with its U.S. studio following a massive cyberattack and the controversy over the comedy "The Interview", with the group CEO being consulted on key decisions, company officials said.

Before the devastating cyberattack, Sony Pictures Entertainment was relatively independent of the Tokyo HQ, despite the company's slogan that it is "One Sony" across an empire of movies, music, gadgets and even insurance.

But group CEO Kazuo Hirai has become more involved after the hacking, which debilitated Sony Pictures’ computer network and led to the online leaks of unreleased movies and embarrassing emails. It is considered the biggest attack of its kind on U.S. soil.

Officials with direct knowledge of the relationship said Sony Pictures Entertainment Chief Executive Michael Lynton consulted Hirai in his decision this week to push through with the release of the movie about a fictional plot to assassinate North Korean leader Kim Jong Un.

Lynton had made the call to drop the movie after major theater chains canceled plans to show it under threats from the hackers, the sources said. He reversed that decision less than a week later and released the movie after President Barack Obama joined other critics in saying Sony had erred, they said.

However, Hirai approved both decisions, the sources said.

"Lynton has been making the decisions but Hirai has been supporting them," one source said, declining to be named because he was not authorized to speak to media.

Hirai is now in California, where he has a house and spends his holidays, and is communicating frequently with Lynton, one official said.

The U.S. government blames North Korea for the attack, with Obama on Friday vowing a proportionate response and casting the issue as one of defending free speech and standing up to attempted "censorship" by "some dictator some place."

Ahead of the hastily scheduled premiere at some 320 independent theaters, Sony released the film straight to U.S. consumers on Wednesday in an unprecedented online debut after the hacker threats had prevented a wider Christmas release.

Hirai, 54, is bilingual in English and Japanese and grew up in the United States, Canada and Japan. After graduating from a Tokyo university, he joined Sony Music Entertainment Japan in 1984 and later worked for the company’s video games unit where he was credited for growing its PlayStation business.

He is widely seen as one of the company's few executives capable of bringing together the manufacturing and movie-making cultures of Tokyo and Hollywood.

The movie business has been a rare bright spot for Sony, which is headed for its fifth net loss in six years and has cut its earnings forecasts six times in Hirai's two years at the helm. The Japanese conglomerate, which took a massive impairment charge on its smartphone unit in September, is struggling to regain the iconic global luster it had as the inventor of the Walkman and other devices.

The Hollywood studio is fully owned by Sony Corp, which bought it in 1989, but normally makes decisions independently.

Months ago, Hirai asked Sony Pictures co-chairman Amy Pascal to tone down the movie's assassination scene but encountered resistance from the film's creators, including co-star Seth Rogen, according to e-mails leaked last month by the hackers.

It is not rare for Hirai to look at scripts in advance, but it is unusual for him to give feedback on particular scenes, Sony sources said.

(Reporting by Reiji Murai and Ritsuko Ando in TOKYO and Mary Milliken in LOS ANGELES; Editing by William Mallard and Raju Gopalakrishnan)