George Lucas: The Story Behind His $4 Billion ‘Star Wars’ Empire

In a recent annual report to shareholders, Disney CEO Bob Iger provided an update on the upcoming Star Wars films.

The rights to the franchise were acquired by Disney when they purchased Lucasfilm from George Lucas in 2012 for a reported $4.05 billion.

Since Lucas owned 100 percent of the company, all the money went directly to him.

According to Iger, the first standalone Star Wars movie will be released next year, followed by Episode VIII in 2017, and Episode IX in 2019.

Meanwhile, at the 2015 Sundance Film Festival, George Lucas participated in a panel discussion on independent film with Robert Redford.

The talk, titled “Power of Story: Visions of Independence,” shed light on how both men had made most of their films independently.

Lucas, in particular, shared his frustrations with Hollywood studios during the making of his early films.

Lucas recounted how the studios demanded cuts from his movies THX 1138 and American Graffiti, which infuriated him.

He became disillusioned with Hollywood executives and decided to distance himself from them.

This led him to build his own studio, Lucasfilm, along with Industrial Light & Magic (a visual effects house) and Skywalker Sound (a post-production sound design company).

Prior to the release of Star Wars, he also obtained the rights to create sequels.

Lucas explained that the idea of licensing for Star Wars merchandise did not exist at the time.

However, he saw an opportunity to build an audience by creating posters and t-shirts.

This strategy proved successful, especially after partnering with a toy company to produce action figures based on the franchise.

After the release of Star Wars, Lucas made a bold move in the movie business by deciding to finance his own projects.

This allowed him to have complete control over the creative process, without interference from studios.

He invested everything, including taking out bank loans, into the making of The Empire Strikes Back and subsequent films.

Lucas emphasized that owning the movie was key to making significant profits.

He shared an anecdote about a conversation with Alan Ladd Jr., the head of Fox at the time.

Lucas had 50 percent of the net profits because his company was responsible for making the film.

When he asked Ladd what he was doing for his 50 percent share, Ladd mentioned providing the money.

However, Lucas pointed out that Ladd simply obtained a bank loan, so he was not actively contributing to the production.

For The Empire Strikes Back, Lucas took matters into his own hands and presented Fox with a unique distribution contract.

This allowed him to finance the film himself and receive 100 percent of the profits.

He made it clear that he was willing to take on the financial risk in order to have full control over his work.

In conclusion, George Lucas built his $4 billion ‘Star Wars' empire by starting independently, creating his own studio and production companies, and ultimately financing his own films.

His determination and stubbornness played a significant role in shaping the iconic franchise we know today.