Sony Sees New Role for U.S. Operations

Sony Corp. President Nobuyuki Idei says he now plans to replace Michael “Mickey” Schulhof, the former head of the electronic giant’s U.S. operations.

But it won’t be with Mike Ovitz. And it will be a redefined role.

At least that’s what Idei told reporters in Tokyo on Thursday who attended a Sony news conference announcing a major restructuring of the firm’s New York operation.

Idei also said Sony wants to expand into digital satellite broadcasting. Sony has been negotiating with News Corp. and Japanese entertainment company Softbank Corp. on participating in their satellite television venture, JSkyB, a Softbank spokesman said today in Japan. The venture will begin broadcasting in Japan in April and Sony would like to buy a one-third interest.

Sony Corp. Chairman Norio Ohga said at the media gathering Thursday that with the growing importance of the U.S. market, the company wants to transform its New York base into a “second headquarters” that will function more as a strategic brain trust rather than an operational unit for the Sony group.

The top executive there would have no managerial authority over Sony Pictures or Sony Music, as Schulhof did, giving those units more autonomy than they’ve had in the past.

It was inevitable that rumors resurfaced this week that Ovitz was going to run Sony’s U.S. operations in the next few months. After all, it’s been almost a month since the former superagent left his short-lived post as president of Disney and shockingly fell below Hollywood’s radar screen--if only momentarily.

But once again Idei pooh-poohed plans to hire Ovitz, though he did stop short of a categorical denial: “I don’t think, in the foreseeable future, Sony has [any] intention to hire Michael Ovitz as the strategic head of Sony Corp.”

Idei has spoken highly of his friend Ovitz, who has continued to serve as an unofficial strategic advisor to the Sony chief, and he did so again Thursday. “Michael has a really good talent for thinking in visionary [terms] of Hollywood’s future. So I think regardless of the current situation, he will make a success in the future in Hollywood. I don’t know which company.”

There continues to be speculation that Ovitz may yet wind up tied to Sony in some way, if not in a top corporate post, then possibly playing a role when the Japanese parent sells part of its entertainment empire to the public, as it confirmed it is considering as one of several options.

Meanwhile, Idei says he hopes to name a successor to Schulhof by April 1.

Schulhof was fired in December 1995 after Sony’s monstrous $3.2-billion loss on its entertainment operations. When he spoke to reporters at Sony Pictures headquarters in Culver City two months ago, Idei was much more circumspect about how Sony’s New York headquarters would be organized.

Thursday in Tokyo, the Sony chief said the “mission” of that now-vacant position will be redefined. He denied having any specific candidate in mind, but said the executive must know both the Japanese and U.S. operations. The executive will also have to have knowledge of both electronics and entertainment.

Idei said the candidate does not necessarily have to be American, “because nationality is not really important for the headquarters.”

Someone with a strong entertainment background “would not necessarily be the No. 1 choice,” added Kei Sakaguchi, director of communications and external affairs for Sony Corp.

This has raised speculation that the ideal candidate might be Sony veteran Masayuki “Yuki” Nozoe, whom Idei recently installed as a key member of Sony Pictures’ new management team, which also includes President John Calley and co-President Jeff Sagansky.

Nozoe, who as executive vice president oversees technology issues, is the first Japanese executive to be placed inside the studio since Sony bought into the entertainment business seven years ago. It’s not at all far-fetched that after Nozoe learns the lay of the entertainment land, he may be relocated back to New York as the company’s top U.S. strategist.

At 47, Nozoe is a 24-year veteran of Sony, having spent most of his career in marketing and planning. He worked for Sony’s U.S. operations for 20 years and speaks fluent English. He moved to Sony Corp. of America in New York last February after working as a senior marketing executive for Sony Electronics’ Consumer Products Group.

Idei indicated that the new head of the New York office will not necessarily carry the former Schulhof title of chief executive, nor for that matter will the name Sony Corp. of America necessarily remain the same.

“I think we should reposition the role of today’s Sony Corp. of America to be more of the headquarter-type business rather than operational business,” Idei said.

In addition to handling more strategic-planning responsibility, the New York office will handle legal and financial services for the Sony group.

Mitsuru Oki, a Sony spokesman in Tokyo, said, “From the operational point of view, the New York office should function as Tokyo’s extended arm,” or as an alter ego.

Under Schulhof, the Japanese electronics giant was kept at arm’s length by its U.S. executives--something Idei already moved to change by appointing Nozoe to the team.

For years, Sony Pictures has been plagued with management upheaval and a long string of box-office flops. Last year, a new management team was named both to Sony’s Columbia Pictures and TriStar Pictures units, and, ironically, the studios have been basking in some recent box-office and critical success from films made under the previous regime, including “Jerry Maguire,” “The People vs. Larry Flynt” and “Beverly Hills Ninja,” last weekend’s No. 1 film.

Idei said Sony is encouraging “the independence, the autonomy of Sony Pictures Entertainment . . . rather than controlling [it] indirectly.”

Reaffirming what he told the media here in November, Idei said he has confidence in Calley and his staff to be specialists in the movie area without his interference. “I don’t make any direct instruction from Tokyo.” The same holds true for Sony Music chief Tommy Mottola on the record side.

Sony executives said nearly 30% of its overall sales now come from the U.S. market. About 25% comes from the Japanese market.