{"id":29274,"date":"2021-03-15T10:00:17","date_gmt":"2021-03-15T14:00:17","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=29274"},"modified":"2021-03-22T00:28:44","modified_gmt":"2021-03-22T04:28:44","slug":"disney-buys-lucasfilm","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/","title":{"rendered":"Disney Buys Lucasfilm: The Fight for Creative Control"},"content":{"rendered":"\n

Why were negotiations so difficult when Disney bought Lucasfilm? How did Disney’s CEO Bob Iger convince George Lucas to give up his control?<\/p>\n\n\n\n

Disney CEO Bob Iger<\/a> knew that it would be a difficult road if Disney bought Lucasfilm. Iger would have to negotiate with George Lucas, who was notorious for wanting control over the Star Wars <\/em>mythology. After many disagreements, Lucas finally sold to Disney.<\/p>\n\n\n\n

Continue on to learn how Disney bought Lucasfilm.<\/p>\n\n\n\n\n\n\n\n

Disney Buys Lucasfilm and the Star Wars<\/em><\/strong> Franchise<\/h2>\n\n\n\n

After Disney bought Pixar<\/a> and Marvel, they set their sights towards Lucasfilm, the company founded by George Lucas and owner of Star Wars.<\/em><\/p>\n\n\n\n

Disney had a long-running relationship with Lucasfilm. In the 1980s, former Disney CEO Michael Eisner<\/a> licensed Star Wars<\/em> and Indiana Jones<\/em> to build attractions at their theme parks. In 1992, after Twin Peaks<\/em> became a creative phenomenon, Lucas pitched a show that would become The Young Indiana Jones Chronicles<\/em>. After a good opening, the ratings fell; ordinarily the show would have been canceled, but Iger gave them a second season since Lucas was doing his best and, after all, it was George Lucas. <\/p>\n\n\n\n

Now, Iger wanted to approach Lucas about the possibility of Disney buying Lucasfilm, but he had to be careful. Moreso than Pixar and Steve Jobs<\/a> or Marvel and Ike Perlmutter, Lucasfilm was the baby of George Lucas<\/strong>. He founded the company and grew it over 40 years, and he created Star Wars<\/em>, which was perhaps a generation\u2019s defining mythology. Lucas\u2019s life would be known for Star Wars<\/em>, and Iger had to approach Lucas in a way that showed he understood that and would protect his legacy.<\/p>\n\n\n\n

In May 2011, Lucas was visiting Orlando to launch the reopening of Star Wars<\/em> attractions at Disney World, and Iger took this chance to meet with him. He had breakfast with Lucas and his fiancee, and halfway through Iger broached the topic of whether George had ever thought about selling Lucasfilm. Lucas was getting older, and he had no clear succession plan. While he had the ability, shouldn\u2019t George decide how his legacy would be handled?<\/p>\n\n\n\n

Lucas agreed. He wasn\u2019t ready to sell, but he was aware that his legacy needed protection after he was gone. And if he did decide to sell, he said the only candidate would be if Disney<\/strong> bought Lucasfilm.<\/strong> He had always trusted Iger for giving the Indiana Jones show a fair chance, and now he saw what a magnificent job they\u2019d done with Pixar.<\/p>\n\n\n\n

Upon hearing the news, Iger\u2019s deputies urged him to press forward with the conversation. But Iger knew that, in this case, the action had to come from Lucas himself. So they waited.<\/p>\n\n\n\n

Negotiating the Deal<\/strong><\/h3>\n\n\n\n

At the end of 2011, seven months later, Lucas called Iger. He was now ready to let Disney buy Lucasfilm. <\/p>\n\n\n\n

In a meeting, Lucas stressed that he wanted \u201cthe Pixar deal\u201d\u2014specifically, a deal worth around $7.4 billion, what Disney paid for Pixar. George believed that Lucasfilm was at least as valuable as Pixar. Immediately, Iger knew this was an undoable price<\/strong>. Despite Lucasfilm\u2019s renowned brands, it was in a materially different position from Pixar. Pixar had six movies in the pipeline; Lucasfilm had none. Pixar came with a fully-developed team of directors, technologists, and writers; Lucasfilm was the only director. Moreover, because Lucasfilm wasn\u2019t a public company (unlike Pixar and Marvel), Disney could only guess at its financials and operational information.<\/p>\n\n\n\n

Iger asked Lucas for confidential access to Lucasfilm\u2019s operating information to get a better sense of the price they could offer, and George agreed. Disney\u2019s team went to work, estimating the value of possible new Star Wars<\/em> films, consumer products and toys, and additions to their theme parks. However, there was still a lot of uncertainty\u2014unlike with Marvel, there was no cohesive creative vision around the future of Star Wars<\/em>, and the development could be drought with risks and setbacks.<\/p>\n\n\n\n

Iger went back to George and said the price range they could offer was between $3.5 billion and $3.75 billion. Lucas had abandoned his expectations of Pixar pricing, but being priced lower than Marvel was a slight. Iger went back to his team and, with some more aggressive estimates, they could pay $4.05 billion, just a hair above Marvel\u2019s price. Lucas agreed.<\/p>\n\n\n\n

Even with the price settled, the thornier negotiation point was the extent of George\u2019s creative control at the new company. In George\u2019s view, he should retain creative control over what Disney developed<\/strong> without being an employee. Iger knew this was a non-starter\u2014they couldn\u2019t pay $4 billion and then give Lucas carte blanche to develop whatever he wanted. <\/p>\n\n\n\n

The discussion stalled on this point for months. Lucas couldn\u2019t bear the thought of having no control over his mythology; Disney couldn\u2019t responsibly give up their control. Twice, discussions stopped entirely due to disagreements.<\/p>\n\n\n\n

What finally pushed the deal over the edge was finances. Due to capital gains changes starting in 2013, Lucas would lose $500 million if he didn\u2019t sell by the end of 2012. In the end, George relented, choosing to serve as a consultant for Disney at Disney\u2019s request, with Disney having no obligation to use his ideas.<\/p>\n\n\n\n

At the end of October 2012, they signed the agreement and announced it; the deal closed in December that year.<\/p>\n\n\n\n

The Force Awakens<\/em><\/strong><\/h3>\n\n\n\n

To justify the $4 billion price of Disney buying Lucasfilm, Disney had to make new Star Wars<\/em> films on a tight timeline, and they had to be blockbusters. The pressure on the first film was enormous.<\/strong> The Star Wars<\/em> fan base was deeply committed, and there hadn\u2019t been a Star Wars<\/em> film since 2005, seven years earlier, and now this would be the first one without George Lucas involved. Disney had one shot to convince the fanbase that they weren\u2019t going to destroy decades of legacy.<\/p>\n\n\n\n

Disney hired J.J. Abrams as director, and Iger joked that this was a \u201c$4 billion movie.\u201d Abrams didn\u2019t find this funny. Through development, Abrams felt the pressure, but he faced it valiantly, and Iger made clear he supported him fully and shared in the stress.<\/p>\n\n\n\n

Despite selling Lucasfilm and becoming a billionaire, George Lucas still found it hard to stomach his lack of creative control. Early in development, the Disney team met with Lucas to share their script. Lucas was appalled at the direction and insulted that they hadn\u2019t used ideas he had previously contributed. Then, when George saw a screening of The Force Awakens<\/em>, he was disappointed in its lack of innovation\u2014unlike what he strove to do with each of his films, this new film had no new technology, no new visuals, no new groundbreaking worlds.<\/p>\n\n\n\n

Despite these criticisms, the Disney team held firm. Their job wasn\u2019t to break the mold too early; they needed to gain the trust of Star Wars<\/em> fans, and this meant a movie that was strongly rooted in the past, even if it was somewhat unoriginal. And, to his credit, George Lucas followed the non-disparagement clause in his contract and showed up at the movie premiere, where he got a standing ovation from the audience.<\/p>\n\n\n\n

The Force Awakens<\/em> turned out to be a critical and commercial success, and the Disney team was relieved.<\/p>\n\n\n\n

On reflecting on the three major acquisitions in Pixar, Marvel, and Lucasfilm, Iger notes that authenticity was critical to making the deals<\/strong>. The major owner of each company wanted to know that Disney was going to protect their company\u2019s legacy, and Iger thinks they did an admirable job of it.<\/p>\n","protected":false},"excerpt":{"rendered":"

Why were negotiations so difficult when Disney bought Lucasfilm? How did Disney’s CEO Bob Iger convince George Lucas to give up his control? Disney CEO Bob Iger knew that it would be a difficult road if Disney bought Lucasfilm. Iger would have to negotiate with George Lucas, who was notorious for wanting control over the Star Wars mythology. After many disagreements, Lucas finally sold to Disney. Continue on to learn how Disney bought Lucasfilm.<\/p>\n","protected":false},"author":8,"featured_media":29282,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[45,81,39],"tags":[234],"class_list":["post-29274","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-economics","category-history","tag-the-ride-of-a-lifetime","","tg-column-two"],"yoast_head":"\nDisney Buys Lucasfilm: The Fight for Creative Control - Shortform Books<\/title>\n<meta name=\"description\" content=\"Former Disney CEO Bob Iger had a tough time negotiating with George Lucas, but he knew if Disney bought Lucasfilm, it would pay off.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Disney Buys Lucasfilm: The Fight for Creative Control\" \/>\n<meta property=\"og:description\" content=\"Former Disney CEO Bob Iger had a tough time negotiating with George Lucas, but he knew if Disney bought Lucasfilm, it would pay off.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/\" \/>\n<meta property=\"og:site_name\" content=\"Shortform Books\" \/>\n<meta property=\"article:published_time\" content=\"2021-03-15T14:00:17+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-03-22T04:28:44+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/s3.amazonaws.com\/wordpress.shortform.com\/blog\/wp-content\/uploads\/2021\/03\/disney-lucas.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1056\" \/>\n\t<meta property=\"og:image:height\" content=\"563\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Hannah Aster\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Hannah Aster\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"6 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/\"},\"author\":{\"name\":\"Hannah Aster\",\"@id\":\"https:\/\/www.shortform.com\/blog\/#\/schema\/person\/f39f52830e4f7039a16e45d12354542f\"},\"headline\":\"Disney Buys Lucasfilm: The Fight for Creative Control\",\"datePublished\":\"2021-03-15T14:00:17+00:00\",\"dateModified\":\"2021-03-22T04:28:44+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/\"},\"wordCount\":1273,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/#organization\"},\"image\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.shortform.com\/blog\/wp-content\/uploads\/2021\/03\/disney-lucas.jpg\",\"keywords\":[\"The Ride of a Lifetime\"],\"articleSection\":[\"Business\",\"Economics\",\"History\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/\",\"url\":\"https:\/\/www.shortform.com\/blog\/disney-buys-lucasfilm\/\",\"name\":\"Disney Buys Lucasfilm: The Fight for Creative Control - 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