Threats Won’t Keep Rogen Fans From Seeing ‘The Interview’

Seth Rogen fans take heart: “The Interview” will eventually make it to TV, the Internet and possibly theaters. The question is when.

Sony Pictures first needs to figure out how to recoup some of the estimated $80 million it spent making and marketing the comedy about a plot to kill North Korean leader Kim Jong Un. Some pundits are pushing the entertainment division of Tokyo-based Sony Corp. to make the movie available instantly online. That may not be the best way.

“These are uncharted waters,” said Brian Kingman, a Glendale, California-based managing director at Arthur J. Gallagher & Co., which provides insurance to the entertainment industry. “Due to the streaming sources available now and home-video platforms, I find it really hard to believe the public will not eventually see this.”

The fate of the movie hinges on insurance, Sony’s contracts with pay television services and the studio’s willingness to take additional risks. Retailers and cable providers will have their own qualms about showing the picture.

Today won’t be soon enough for supporters ranging from Netflix Inc. Chief Executive Officer Reed Hastings to former presidential candidate Mitt Romney, who have posted online comments urging the studio to release the picture in protest of the hackers’ efforts to stifle free speech.

“Don’t cave, fight,” Romney wrote in a Dec. 17 Twitter post. He urged Culver City, California-based Sony Pictures to release the film free online globally and ask viewers to donate $5 to fight Ebola.

‘Say No’

Sony has no further release plans for the picture, the studio said yesterday after announcing it had abandoned plans for a theatrical release. The company today declined to comment on its plans for the picture, according to Bob Lawson, an outside spokesman with Rubenstein Communications.

Hastings, head of the largest online subscription service, weighed in before theaters started dropping the picture and Sony decided to abandon the release.

“Say no to cyber intimidation and yes to outrageous humor,” Hastings wrote on Dec. 10, saying he’ll buy 10 tickets. “Let’s make this THE BIGGEST movie of the year.”

Under conventional pay TV contracts, Starz LLC, Sony’s premium cable-TV partner, may only have rights to films that are shown in theaters, according to John Burke, Los Angeles-based head of the entertainment group at Akin Gump Strauss Hauer & Feld LLP. Because “The Interview” wasn’t released in cinemas, Sony could be free to market the picture elsewhere, he said.

Online Risk

Netflix, based in Los Gatos, California, could become an outlet for “The Interview” if Hastings is willing to risk an attack on his computer systems by the Sony hackers. The FBI has linked the cyberterrorists to North Korea, according to a person briefed on the probe.

The company hasn’t had any discussions with Sony about the film, Cliff Edwards, a Netflix spokesman, said in an interview.

Sony’s business partners in the home-entertainment market include cable and satellite-TV distributors, which offer films on a pay-per-view basis, DVD retailers, and Starz. Older movies are sold to basic cable and broadcast networks.

All of those parties will have to weigh whether they want to be involved with the picture, according to Burke.

“That’s probably what’s going on with Sony’s partners,” Burke said in an interview. “They’re asking how close do we want to get to this. The retail outlets may have said they don’t want the product in their stores.”

Theaters Bail

Comcast, the largest U.S. pay TV service, has no plans to offer the movie on demand, according to a person close to the company who wasn’t authorized to speak publicly and asked not to be named.

Hulu LLC, another streaming service, declined to comment, as did Apple Inc. Amazon.com Inc. didn’t respond to requests for comment.

Sony canceled plans to release “The Interview” after major theater chains including Regal Entertainment Group, AMC Entertainment Holdings Inc., Cinemark Holdings Inc. and Carmike Cinemas Inc. decided not to exhibit the picture.

Those that issued statements on their decision cited public safety for the moves.

Theaters could also have faced liability “particularly when you link up the fact that the movie is antagonistic to a country that is known to be trigger happy, or prone to lashing out when they feel that their sense of national dignity has been assaulted,” Stanford Law School Professor Robert Rabin said in an interview.

Insurance Policies

Kingman, of Arthur J. Gallagher, said film insurance covers a variety of claims, from copyright infringement to actor sickness or deaths to hurricanes and even earthquakes during shooting. He’s unaware of a product that would fully cover Sony’s losses for voluntarily withdrawing the movie.

“I don’t know of any insurance product that’s going to indemnify or pay for lost revenue” in such a case, he said.

Sony’s loss on “The Interview” doesn’t approach the financial damage studios have taken in the past on some of their biggest box-office bombs.

In 2013, Walt Disney Co. said it would record a loss of as much as $190 million on “The Lone Ranger,” a Johnny Depp picture that cost $225 million to produce and millions more to market. A year earlier, Disney took a $200 million loss on the science fiction bomb “John Carter.”

“The Interview” could eventually get theatrical screenings, according to Burke, the industry lawyer.

“I don’t think you’re going to see it through a major studio,” he said. “It may be released through a smaller company that is more entrepreneurial and willing to take the risks.”

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