Google Inc.'s (GOOGL) YouTube division has agreed to distribute the Sony Pictures film "The Interview." The movie was the subject of one of the most disturbing hacks of corporate information in history.
“The Interview”
This is the story of the fictional murder of North Korean leader Kim Jong Un. The U.S. government has linked North Korea to the hack, which ended up disclosing information on salaries and executive emails.
Sony however went ahead with a restricted theatrical release of the film.
The resolution to release the movie online is a reversal of Sony’s decision to halt the movie's release after it was condemned for self-censorship.This decision intensifies the conflict between the company and the Guardians of Peace, a group that took charge of the hack. The group has pledged to disclose further damaging information if the movie was released.
The Internet services that are offering the film include Google Play store, YouTube and Microsoft’s (MSFT) Xbox Video. With the help of technology companies Kernel and Stripe, Sony is also showing the film on a website of its own. The film is available on rent for $6 can be purchased for $15. It has released in some 200 independent theaters. None of the cable or satellite TV operators have yet decided to make "The Interview" available through video on demand (VOD).
Apple's (AAPL) iTunes store was conspicuously not on Sony's list.
What is in it for Google?
Google's choice to stream "The Interview" may help in legitimizing its YouTube platform as a serious contender for paid video streaming services against Netflix and Amazon.com Inc. (AMZN).
With the launch of YouTube Music Key, a paid ad-free service, YouTube has recently tried to modify its image of an Internet warehouse of homespun videos and shift towards more professionally produced content to increase its business.
One major menace for Google is that YouTube could become the target of Sony's hackers, even though the company is known to have strong cyber defenses.
Barrett Lyon, principal strategist with F5 Networks and an expert in Internet network security is of the opinion that “Google has an "enormous" infrastructure that is well-tested in fighting off denial of service attacks and other threats."
Google currently has a Zacks Rank #4 (Sell).
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