I've been following the Sony hack/Interview story all week with mixed feelings. On the one hand, I found the idea of a Hollywood movie where a pair of American journalists go assassinate an existing, sitting head of state to be a little creepy. When the movie was announced, my first thought was, "What would America (ie the FBI, NSA, CIA, etc) do if Russia or Iran came up with a movie in which someone assassinated Barack Obama?" More pertinently, positioning it as a comedy seemed particularly off.
On the other hand, canceling it completely gives the appearance of capitulating to the hackers who have caused Sony so much damage. I understand Sony's contention that they had no choice because none of the major theater chains was willing to release it - but this still has a chilling effect on art and gives hackers from hostile countries proof that fucking with a major studio like that can work.
It's hard not to feel a little bad for Sony, in any case. As I say, I understand why they've pulled it from theaters, given that no theater chains seemed willing to carry it. Some were saying Sony should release The Interview on VOD, but in this atmosphere that strikes me as a slap in the face to theater chains - Cinemark and Carmike and their ilk are already suffering from an existential crisis, so to have a studio just bypass them completely would be grounds for them not carrying Sony movies in the future.
That might escalate into a war that would cause the chains to go out of business completely, but in the short term VOD is probably not viable enough that Sony's willing to risk having to shift its entire distribution model in that direction.
Straight-to-DVD is also an option, but probably not lucrative enough for Sony to really pursue... and outlets that carry physical DVDs are even more endangered than movie theaters, so they're probably even more chicken about carrying something as highly charged as the Interview (even if it seems unlikely that North Korean hacker/terrorist collectives would be able to pinpoint individual Best Buys or Walmarts).
That all said, I was reading that the leaked emails suggest the Interview is painfully bad, and Sony executives knew it. The kerfuffle around the leaked emails and the chains refusing to carry it probably gives Sony the cover to just pull the damn thing - sure, they've financed it thus far, but now they don't have to shell out any more cash to distribute it, promote it or premiere it. This episode will probably show up as a nasty blot on Sony Entertainment's Q4 results, but might not be as bad as if they actually released it and let people see what a piece of crap it was (again, I'm speculating - but to me the trailer looked singularly unappealing, and I was very likely not going to see it, creepy idea or not).
As far as the political response, I see President Obama as essentially doing what he has to in this case, which is also about all he can do. A nebulous threat to national security has resulted in a number of big business decisions, and nothing he says will actually change that - he can't issue an executive order to have the Interview released, but he'd really be screwing up if he didn't speak out about the threat and the movie's cancellation.
The most troubling political aspect, however, is the way that the minute someone invokes 9/11 we lose our nerve, no matter how shadowy (and likely fake) the group behind the threat is. While I don't want to see terrorist attacks on American soil, whether from foreign enemies (like al Qaeda) or domestic (like the NRA; yes, I went there), I also have a hard time believing that North Korea's security apparatus extends to targeting individual movie theaters, on a continent thousands of miles across and on the other side of the world.
It was troubling back in 2001-2002 how so much art, across movies, TV and comics, was cancelled because of 9/11 and the "offensiveness" of showing buildings being blown up, but at least then people were legitimately scared. But you still get idiots being offended at depictions of the Twin Towers - when Fringe revealed that they still stood in its alternate-universe New York, my then-flatmate (the stupidest human being ever to walk the Earth) said it was "fucked up" that they showed the buildings. And this was in 2012, for fuck sake.
From an artistic point of view, then, pulling the Interview (as bad as it may or may not be) is the worst response possible. Now that we've set a precedent for it, China or Russia or whoever can just hire a proxy to hack a server somewhere, vaguely mention 9/11, and they'll be able to get anything cancelled. It's happened to the Interview now, but who's to say it can't happen to something with actual artistic merit or entertainment value?
While Benjamin Franklin's quote about liberty vs security may be taken out of context, the way we use it now is actually relevant, pace Techcrunch - it's not smart to give up liberty in exchange for security in the short term, as you really do give up both in the long term. We're seeing those twin losses right now.