Top 12 Film Industry Stories of 2012: #1

The Force Is with Disney

By David Mumpower

January 9, 2013

George's face is riddled with instant remorse.

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2012 was a year of change for Lucasfilm. In January, Star Wars creator George Lucas announced that he would no longer produce the epic blockbusters that had made him a Hollywood legend. In June, Lucas put himself out to pasture by promoting vaunted producer Kathleen Kennedy to co-chairman of Lucasfilm Ltd. With his eventual successor in the fold, Lucas was poised to retire after 35 years of box office domination. Nobody expected the next major announcement regarding Lucasfilm, though.

The core of Lucasfilm, the Star Wars franchise, has earned $4.5 billion from global box office sales alone. It has earned an additional $3.8 billion from home video, $2.9 billion from videogame licenses, $1.8 billion from book sales and $1.3 billion via other revenue streams. That’s a rough estimate of $14.3 billion over the course of the franchise’s 35 years in existence. And you will notice that I left out a key component in the calculations above.

Toy sales comprise the overwhelming majority of annual Star Wars sales. Estimates place total toy sales for Star Wars north of $12 billion. While no one outside of Lucasfilm’s accounting office will ever know for sure, these numbers are semi-confirmed by Forbes Magazine. They also note that in 2011 alone, Star Wars sold $1.5 billion worth of toys and games.

To put this number in perspective, consider that Star Wars: Episode I – The Phantom Menace is the best box office performer of the six movies made thus far. Its worldwide gross is just over a billion dollars. In 2011, Star Wars as an intellectual property for merchandising earned 50% more through toy sales alone. This happened despite the fact that there had not been a Star Wars movie since 2005. Star Wars as a movie is a Trojan horse of sorts. The aftermarket is where George Lucas has sold enough ancillary Star Wars merchandise to become a billionaire.




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In the merchandising world, there is one heavyweight that lords above all others. Disney has mastered the art of selling toys to children. In 2011 alone, Disney sold $37.5 billion worth of retail licensed products. The next closest global competitor managed “only” $12 billion. Yes, Disney has tripled its nearest competitor. Even the vaunted toy distributor, Mattel, grossed a modest $7 billion in sales in 2011, over $30 billion short of Disney in the same calendar year. Mickey Mouse has lapped the competition in every conceivable way.

The problem with possessing a de facto monopoly on global sales is finding new avenues for growth. In August of 2009, Disney attempted to correct a longstanding flaw in their internal economy. Disney toy sales have historically skewed to girls because of iconic princess characters in their film library. Disney Princesses are the top merchandising items in the world, after all. In the 2000s, the company has actively sought to create more of a toy sales balance between girls and boys.

The corporation accidentally stumbled into a solution for this when they purchased Pixar Animation Studios in 2006. The price tag was a respectable $7.4 billion. No one questioned the value of this proposition since Pixar was the gold standard in family fare at the time. A few months later, Cars was released into theaters and by the end of the year, Lightning McQueen and Mater had become two of the hottest toys on the market. Boys loved Cars merchandise to the point that an argument could be made that Disney has broken even on its $7.4 billion Pixar purchase through Cars toys alone.


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