Fallout from the

Hacking Scandal

http://www.motherjones.com/mixed-media/2014/06/north-korea-not-respond-yet-seth-rogen-james-franco-interview-movie-trailer

http://commons.wikimedia.org/wiki/File:Sony_pictures_logo.pngTeam 4Ying Chyi Gooi, Aaron Cheong, Yee Xiong

Hing

Agenda

Recommendation Capital Budgeting Revised Forecast Post-crisis Evaluation Questions for

Consideration Conclusion

Recommendation

http://www.impawards.com/2014/interview_ver3_xxlg.html

Recommendation

Charge $7/Pay-per-view

Alternative: $10/Pay-per-view

Capital Budgeting

Capital Budgeting (Task #1 analysis)

Scenario Summary Most Likely Best Case Worst Case

Changing Cells:      

Theatrical (in units) 12,000,000 15,000,000 10,000,000

Pay-per-view (in units) 10,000,000 12,000,000 80,000,000

Result Cells:      

NPV $8,047,068 $18,046,097 ($7,341,604)

IRR 17.40% 36.95% -10.71%

Revised Forecast

Revised Forecast(Task #2 analysis)

Scenario Summary Most Likely Best Case Worst Case

Changing Cells:      

Theatrical (in units) 10,000,000 12,000,000 8,000,000

Pay-per-view (in units) 11,000,000 12,000,000 1,000,000

Result Cells:      

NPV ($722,340) $5,743,036 ($7,128,326)

IRR 1.48% 14.21% -11.15%

Post-crisis Evaluation

http://venturebeat.com/2014/12/26/in-new-tragic-twist-critics-say-the-interview-is-actually-a-pretty-terrible-movie/

Post-crisis Evaluation(Task #3)

Scenario Summary Most Likely Best Case Worst Case

Changing Cells:      

Theatrical (in units) 8,000,000 10,000,000 6,000,000

Pay-per-view (in units) 1,000,000 1,200,000 800,000

Result Cells:      

NPV ($6,923,444) ($689,474) ($13,157,414)

IRR -10.13% 1.54% -20.81%

Post-crisis Evaluation(Task #3)

Scenario Summary

Most Likely(Solution 1)

Worst Case(Solution 1)

Worst Case(Solution 2)

Changing Cells:      

Price $7 $7 $10

Result Cells:      

NPV ($5,697,252) ($12,176,461) ($12,544,318)

IRR -7.85% -19.12% -17.09%

Value saved : $1,226,192 $980,953 $613,096

Questions for Consideration

http://www.impawards.com/2014/interview_ver3_xxlg.html

Questions for Consideration Movie-goers don’t decide

based on company

Exchange rate (USD/Y) influences Sony’s profitability

Government perceives threat

Conclusion

http://www.impawards.com/2014/interview_ver3_xxlg.html

Conclusion

Charge $7/Pay-per-view

Alternative: $10/Pay-per-view

Thank You

Yingchyi.gooi@drake.edu Yeexiong.hing@drake.edu Aaron.cheong@drake.edu