“The Interview” Strategic Analysis Carl Budenski, Ben Cole, Matt Horas, Michael Peterson

Outline December 31, 2013 Evaluation December 16, 2014 Evaluation December 20, 2014 Evaluation Additional Information Conclusion Questions

December 31, 2013 Evaluation Calculating Box Office Sales – Under $100,000 Budget Cap – Created A Factor of Approx – Ticket Sale Drop Off

December 31, 2013 Evaluation Digital Streaming – Initial Capital Intake – Royalty Figures – Drop Off DVD Sales – Variable Cost of $.95 – Potential Profit of $9.99 – DVD Sale Drop Off

December 31, 2013 Evaluation Calculating the Weighted Average Cost of Capital – Competitor Weights – WACC Scenarios

December 31, 2013 Evaluation Scenario Summary

December 16, 2014 Evaluation Follows Cyber Attack, Terrorism Threat Theater Chains Still Screening Change In Sales Due To Consumer Response Effect On Amazon, Netflix Using 3 Different WACCs

December 20, 2014 Evaluation Film Released in 300 Independent Theaters Focus to Minimize Losses Use Exhibit 3 to Calculate the Box Office Sales

Netflix & Amazon – Charge a Premium Move Projected Release Date Up Cut DVD Sales and Leave Release Date the Same

December 20, 2014 Evaluation Box Office Drop Hurts NPV Raising Netflix and Amazon Helps Minimize Losses More People Will Now Watch Online – Justifies Our Premium

Brand Loyalty in the Movie Industry Disney And Pixar Are Common Household Names Harvard Business School Study Approaches To Choosing A Movie To Watch Unaware Of Sony’s Association

Reputational Damage External – Association With North Korea, Terrorism, And Hackers – Concerns From The White House – Hollywood Reputation Internal – Lawsuits – Personal Information Stolen – Data Stolen

How This Incident Affects Competitors Hackers More Likely To Harm Companies With Differing Ideas – Threat To Free Speech Increased Spending On Security Less Likely To Take Risks

Conclusions Alternatives To Box Office Sales Importance Of Digital Sales Reestablishing Our Positive Public Image Importance Of Public Safety Over Profit

Summary December 31, 2013 Evaluation December 16, 2014 Evaluation December 20, 2014 Evaluation Additional Information Conclusion

Questions?