Sony 2009 Annual Report Download - page 11

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9
• Films like Hancock,starringWillSmith,andQuantum of Solace,
the latest James Bond film, delighted audiences around the
world as Sony Pictures had one of its biggest years on record
at the worldwide box office, showing that demand for entertainment
is strong even in these trying economic times.
• Altogether, Sony’s music businesses were highly profitable in
fiscal year 2008, despite difficult market circumstances. We
acquired Bertelsmann AG’s half of the SONY BMG*4 joint
venture and welcomed the company back into the Sony Group
as Sony Music Entertainment (SME). Sony Music Entertainment
(Japan) Inc. increased its share to top the Japanese market,
and Sony/ATV Music Publishing grew its share of new releases
in the U.S. music publishing market, on its way to recording a
substantial increase in operating profit over the previous year.
Whileitisencouragingtoacknowledgethesesuccesses,thefact
remains that fiscal year 2008 was one of the most difficult years
in this company’s long history. It is indisputable that a substantial
portion of this is attributable to the global economy and the
strength of the yen, but the inescapable truth is that despite our
restructuring and cost-cutting efforts in past years, the downturn
exposed stresses and vulnerabilities in our company that have
built up over a long period of time. Addressing this—and helping
assure that it does not happen again—is my top priority.
Restructuring Plan/Progress
The first and most urgent steps to respond to the global economic
crisis in September 2008 were to quickly adjust our production
levels and to announce and engage in immediate restructuring
and other cost-cutting initiatives.
Below are some of the initiatives we announced*5 and the
progress we have made so far. As you can see, our efforts are
progressing more quickly than originally announced.
• Achieving cost reductions throughout the Sony Group of more
than ¥250 billion in fiscal year 2009 compared to fiscal year
2008throughrestructuringandotherinitiatives.Wenowbelieve
that these initiatives will reduce costs by more than ¥300 billion.
*1 The thinnest part of consumer-use televisions, as of August 28, 2008
*2 40-inch consumer-use televisions (monitor only), as of August 28, 2008
*3 As of December 2008
*4 SONY BMG MUSIC ENTERTAINMENT was a 50-50 joint venture be-
tween Sony Corporation of America and Bertelsmann AG until October 1,
2008, at which time Sony purchased the remaining half of the company,
which was renamed Sony Music Entertainment (SME).
*5 Announced in December 2008 and January 2009