How Star Wars Makes Its Billions

Via Telegraph.co.uk:
Nineteen seventy-five is now a long time ago, some 40 years before millions of us teared up at the sight of an old man in the Miillennium Falcon, before anyone had heard of a holiday called “May the Fourth be with you.” But that’s the year when a young director named George Lucas and his producer, Gary Kurtz, were trying to convince their skeptical studio, 20th Century Fox, to approve a modest budget for their next movie, then called “The Star Wars.”

As they ran out of time for approval, Kurtz says that he and Lucas made a desperate back-of-the-envelope calculation: Any movie with that title would make as much as $8 million in ticket sales to science-fiction fans—if the filmmakers were lucky, maybe $12 million.

That was enough to convince Fox to throw that much at the movie. But of course, the full size of the business empire built around Star Wars dwarfed Lucas’s 1975 imaginings. Eventually, it even dwarfed the profit Fox made from Lucas and Kurtz’s movie. To get an inkling of the true scope of it, remember what Rebel pilot Wedge Antilles gasped upon sighting the Death Star: “Look at the size of that thing!”

Star Wars, which practically invented modern licensing after its 1977 release, has brought retailers more than $32 billion in merchandising sales alone – and that number, according to both Lucasfilm and industry analysts at NPD Group, is increasing by at least $1.5 billion per year.

We don’t know how much of that was Lucasfilm’s cut – it was an intensely secretive private company and is now an intensely secretive Disney subsidiary. But we do know that the six main Star Wars movies made $4.5 billion, according to IMDb, plus the $6.6 billion in video games, home video, DVD and Blu-Ray sales, according to analysis by Forbes and 24/7 Wall Street.

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