Sony’s The Interview: Top Grossing Online Movie Release

Even amid controversies and threats, Sony Corporation’s (SNE) recent most movie ‘The Interview’ became the highest grossing online release of the year. It generated revenues to the tune of $15 million from online viewers and $3 million from its theatrical screenings on the opening weekend.

The movie was released on Christmas Eve at only about 331 theaters and was available online through Google Inc.’s (GOOG) YouTube Movies and Google Play, Microsoft Corp.’s (MSFT) Xbox Video and a dedicated website.

The release of this movie was entangled in controversy after the cyber attack faced by Sony on Nov 24. Per media reports, the hack was a schemed retaliation against the release of The Interview as it involved the fictional assassination of the dictator of North Korea – Kim Jong Un – by a group of hackers called "Guardians of Peace."

The movie was initially scheduled to be released across as many as 3,000 theaters in the U.S. However, following the cyber security breach, Sony scrapped the New York premier and the subsequent release of the movie. Consequently, top theater chains of North America – such as AMC Entertainment Holdings, Inc. (AMC), Regal Entertainment Group and Cinemark Holdings Inc. – postponed the screening of 'The Interview' without specifying any future release date (read: Sony Scraps "The Interview" Release on Hackers' Threat).

Later, the company decided to launch the movie in a small number of independent theaters and on digital platforms simultaneously in the U.S. The unique distribution strategy paid off for the company. Despite the limited release, the viewer response was overwhelming. Media reports suggest that the movie was downloaded/ rented by over 2 million viewers till Sunday.

Moreover, the movie is now being scheduled for release in other theaters as well. As per a recent report from CBC News, Sony has selected a number of Canadian theaters for the screening of this movie in the upcoming weekend.

Sony has reportedly spent over $80 million for the production and marketing of this movie. If the planned theatrical release of the movie had not been stalled, Sony could have garnered around $120 million in overall revenues, as estimated by box office analysts. However, the availability of the movie via the on-demand medium has so far proved to be beneficial for the company. The movie has already racked more than two other successful movies – ‘Snowpiercer’ and ‘Margin Call’ – that were released at the same time and were also available online.

We will have to wait and see how this movie fares in the upcoming days for this Zacks Rank #3 (Hold) stock.