Hackers And Threats Not Enough To Keep 'The Interview' Out Of Theaters

After a whirlwind of controversy -- including an official cancellation from Sony Corp(ADR) SNE -- "The Interview" will be released on Christmas Day in select theaters. Sony had initially said it had no plans to release "The Interview" after its initial cancellation. When pressed, the studio blamed movie theaters for that decision but said it would still release the movie -- it just didn't know when or where.

Independent theater owners expressed their extreme disappointment with Sony after the studio refused to let them screen "The Interview." Then, just a day before Christmas Eve, Sony announced that it will allow them to show the movie. Only a small number of theaters are on the list, but a VOD (video on demand) release is expected in the near future.

Related Link: Sony Hackers Are Taunting Employees

Why Was 'The Interview' Really Pulled?

Security expert Mark Skilton told Benzinga that he had expected the controversy to blow over, but others aren't so sure.

Rob Enderle, principal analyst at Enderle Group, thinks that Sony initially pulled the film to avoid additional (perhaps more controversial) email leaks. He (along with angry movie theaters) questioned Sony's decision to let theaters ditch the movie only to blame them when the film was eventually pulled.

"They could have immediately turned it around and issued a video on demand," Enderle told Benzinga. "But they didn't do that either."

Enderle speculated that the hackers may have stolen sensitive information that could lead to massive lawsuits. Four suits have already been filed.

"The potential for litigation alone would be legendary," said Enderle, who speculated that the hackers threatened to release more emails if the film is released. "Sony would be a pin cushion for law enforcement, disgruntled employees, minority groups -- you name it. With that kind of a release I figure it would be an end of a career for the executives and the end of business for the most part for Sony."

'Dangerous Precedent'

Actors, filmmakers, politicians, analysts and virtually everyone else agreed that Sony made a bad decision when it decided to pull the film.

"This is a very dangerous precedent," Robert Neivert, COO of Private.me (a startup that built an anonymous search engine and is working on improving privacy on the Internet), told Benzinga. "Not only for movie companies, which can now be threatened."

Enderle is concerned about the perception that Sony temporarily pulled "The Interview" because of the threat of violence.

"We have a lot of organizations that trade in violence that now believe they can use violence to get what they want in Hollywood," said Enderle. "They probably can't tell the difference between Hollywood and news organizations. I think 2015 is going to be the year we blame Sony for an awful lot of what goes on -- rightfully or wrongfully, the Sony decision will be the cause."

Only time will tell if Sony's latest decision can change that.

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.