Episode 6: Lucasfilm

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[17] Who got the truth?

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[26] Another story on the way.

[27] Who got the truth?

[28] Welcome to episode six of Acquired, the podcast where we talk about technology acquisitions that actually went well.

[29] I'm Ben Gilbert.

[30] I'm David Rosenthal.

[31] And we are your hosts.

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[38] Yes.

[39] So this week, we are, uh, I, say we're timely, we're probably a month late.

[40] We were talking about the Disney acquisition of Lucasfilm and all of Lucas Films franchises.

[41] Ben, I am your father.

[42] Wait, that wasn't in the script.

[43] Cut.

[44] All right.

[45] David, over to you first for acquisition history and facts.

[46] Oh, man, Lucas Film.

[47] Star Wars.

[48] What more can you say?

[49] So, George Lucas, obviously, founded Lucasfilm, 1971 in San Rafael, California, which has personal significance for me and my family.

[50] That's where my wife is from, where my in -laws live.

[51] David, where did you watch Star Wars?

[52] And I was going to say, episode seven, we went over the holiday break to the theater in Corder Madera that George Lucas himself helped renovate for the, I believe for the prequels when they came out.

[53] It's a one -screen theater in Marin, and it was amazing.

[54] There's a great Vanity Fair article about this theater and the work that Lucas has done on it.

[55] Super fun.

[56] So, early 70s, Lucas found Lucas film, and the first project that the company does is American graffiti, which comes out in 1973.

[57] And then the next film that the company produces 1977 is a new hope.

[58] Well, I guess it was called Star Wars at the time.

[59] We know it as a new hope.

[60] On this podcast, it's just called Star Wars, David.

[61] All right, Ben.

[62] And then since then over the years, I mean, pretty incredible what this company has has produced both itself and what's come out of it.

[63] I mean, we've already, this is our second episode about a Lucasfilm company.

[64] Disney acquisition?

[65] Yeah, Disney acquisition of a Lucasfilm company.

[66] I was going to try and catch you there.

[67] Well, David, I think you mean because Pixar was also acquired by Disney, but was also spun out of Lucasfilm.

[68] Yeah, well, essentially, I mean, you could argue start it at Lucasfilm.

[69] The company and the product itself, I believe, was started at Lucasfilm.

[70] Lucasfilm.

[71] Yeah.

[72] So I guess, you know, I guess they just took two shots at acquiring Lucasfilm.

[73] Yeah, exactly.

[74] Do you know what else came out of Lucasfilm?

[75] That is no longer part of the company.

[76] Industrial Light and Magic?

[77] Yes, but that's part of the company.

[78] This came out of Industrial Light and Magic specifically.

[79] I have no idea.

[80] Photoshop.

[81] Adobe?

[82] Not Adobe.

[83] Photoshop.

[84] Did Adobe Acquire Photoshop?

[85] Adobe acquired Photoshop, yeah.

[86] Well, there's another episode coming.

[87] Yeah, too, I believe John Knowles was an employee of ILM and one summer, I believe was part of a movie project.

[88] I didn't read the full history online.

[89] Needed this piece of software, so he wrote it and then sold it to Adobe.

[90] Crazy.

[91] Yeah, pretty incredible company.

[92] I think we know what's coming next for Disney.

[93] Among, so those great organizations aside, other things that Lucasfilm contains, Star Wars, Indiana Jones, ILM, obviously, Skywalker Sound, which is film and TV sound production, quite large video game publishing and development arm, which now.

[94] post -acquisition has been mostly outsourced to EA by Disney.

[95] Animation arm, licensing, and then the other company to come out of Lucasfilm was THX, the Consumer Sound Company.

[96] Named for George Lucas's first film in film school, THX 1138.

[97] Did not know that.

[98] So, acquisition.

[99] In 2011, this is a great story, Star Tours, which I've done many, many times, most recently just a few weeks ago in December, was being revamped at Disney World in Florida, and George Lucas flies out to go to the premiere of the new version, the new re -ramped Star Tours ride, and while he's there, he's talking with Bob Eiger, the CEO of Disney, and mentions to him that he's thinking about retiring and maybe selling Lucas film.

[100] and that was that was summer i believe of 2011 and and then about a year later a little over year later october 2012 disney announces the acquisition 4 .1 billion dollars ooh pretty penny and lucas gives quotes an interview saying he never dreamed of selling it to anyone else would have been pretty hard for him to sell it to anybody else yeah yeah it's interesting because i think we'll get a little bit into bob eiger but i mean There's fascinating history there.

[101] There's a 20 -year -old relationship where Bob Eiger was working at ABC and actually green -lit the television show Young Indiana Jones for George Lucas, which did not go so well.

[102] But he kind of stuck with him through at least the first season.

[103] And there's always goodwill between Lucas and the trust that he and Iger had that eventually kind of led them here.

[104] Yeah.

[105] Um, interestingly though, and I didn't realize this until we started researching this episode, um, Disney, uh, obviously spends $4 .1 billion to acquire Lucasfilm.

[106] Um, and acquires a lot within that, all the properties we just mentioned, ILM and Skywalker Sound and whatnot that hadn't been spun out.

[107] Um, but the distribution rights to the original Star Wars movies, uh, were held by Fox.

[108] And still are.

[109] Oh, wow.

[110] So Disney was really making a big bet on the future with this acquisition.

[111] Yeah, because it's easy to justify buying that existing cash cow.

[112] You know, there's pretty much no chance that those movies are going to stop.

[113] Raise your hand if, in anticipation of the Force Awakens, you purchased the, digital purchased the Star Wars collection.

[114] My hands in the air.

[115] I went to watch it on iTunes, and the only way that I could do it was like some, massive three -pack collector's edition, really expensive digital download.

[116] I mean, they...

[117] I sprung for the six -pack on Amazon.

[118] Oh, nice.

[119] So that, when I bought that through Apple on Apple TV, is that through Fox?

[120] That money's going to Fox watching...

[121] We watched 4 -5 and 6 again.

[122] Actually, this isn't fully true.

[123] I watched the despecialized editions, but also...

[124] I'm not going to get into that.

[125] That's a problem.

[126] But, yeah, that's crazy.

[127] So Fox was actually capitalizing on the hype for that opportunity.

[128] I got to imagine, Fox made a significant amount of money in the lead -up to The Force Awakens.

[129] That doesn't include, do you know if that includes merch from those original characters?

[130] Like, if they're selling an episode for Han Solo toy.

[131] Yeah, that's a good question.

[132] I think this is on the Wikipedia article about the acquisition, but...

[133] David's giving me homework.

[134] Yeah, giving us all homework.

[135] I believe I read in there that at least for episode, episode four.

[136] I think there's a special deal for episode four that Fox might be even getting those ancillary rights as well.

[137] Hmm.

[138] Hmm.

[139] Um, um, well, you want to keep going with the, uh, let's keep going.

[140] So, Ben, what's your category?

[141] Hmm.

[142] So as a reminder, we've got people, technology, product, business line and the all powerful other.

[143] This, to me, is a product acquisition in the near term, but it's a lot more in the kind of far -reaching future.

[144] I mean, the way that Disney learned from Pixar and was able to produce in Disney Creative Studios, not in Pixar, Frozen, and put that at the center of the company and have that insane cats, like $1 .4 billion or something, 1 .3, somewhere in there.

[145] Insane cash cow and Frozen.

[146] And Disney learned from that acquisition without messing with Pixar too much.

[147] And that is a Bob Iger thing.

[148] I mean, I think that when Bob Agger took over from Michael Eisner as CEO, he's largely returning to the company's roots.

[149] And there's this incredible diagram that shows Disney's business model and the ecosystem thinking and how everything goes and everything else.

[150] We should link to this online and Twitter.

[151] We'll put in the show notes.

[152] Awesome.

[153] Yeah, and on Twitter.

[154] It's amazing.

[155] Like, anybody who's ever been pitched a company and wondered, ooh, what's the lock -in?

[156] What are the network effects?

[157] You know, how does this company build a mode around itself?

[158] Disney has this unbelievable ecosystem where everything flows into each other.

[159] And the center of the whole thing, as illustrated in this diagram, is phenomenal content in feature -length films.

[160] And that's something that's escaped them for a long time.

[161] I mean, if you look at Disney's revenues right now, one -half are from cable subsidiaries, from affiliate money that they get when, you know, you're - Which probably 90 % is ESPN.

[162] Yeah, 50%.

[163] Oh, like a little over 50%.

[164] But ESPN is a quarter of Disney's revenue.

[165] And if you look every year, it's cord cutting, money's going away.

[166] Like that future was not sustainable and it was drifting far from Disney's original roots.

[167] So putting incredible content and feature -length films back at the center of the business model is a total change of direction for Disney and something that Bob Eager really kind of came in and shook everything up and did.

[168] And he gave a lot of autonomy to all the individual groups.

[169] So, you know, the way that Pixar was left alone, the way that Lucasfilm was left to do its thing, the incredible long -term thing, if they can pull it off, is sort of reverse acquiring the things that made that incredible content and letting them produce incredible content in -house.

[170] Because right now, they bought the Star Wars product, but they have not sustainably proven, and of course this takes a lot of time, that they can now take the muscle of what that made that content incredible.

[171] and make that something that is something they can produce on their own in the future.

[172] Yeah, you're raising a couple interesting themes that I've been noodling on about this.

[173] So one, I would, in my category, so you said product today and business line in the future?

[174] Yeah, I guess, you know, I think it sticks with product, but I think it's that sort of reverse infection thing, like the Apple to Next.

[175] Like can the productiness, the productness that makes Disney and, or that makes Pixar and Lucasfilm what they are.

[176] And I guess you could throw them all in there too.

[177] We might have to do a complete the trilogy here at some point and do Marvel.

[178] Yeah.

[179] Interestingly, just almost about the same price that Disney paid for Marvel as they did for Lucasfilm.

[180] Yeah, we're going to have to do an episode on that.

[181] So at the end of the day, I think it's product that they get this product.

[182] but the ultimate thing that will prove that this spree of acquisitions and this business strategy was successful is, can Disney reacquire that muscle to build their own incredible content of all types henceforth?

[183] Yep.

[184] And, you know, I think, I basically think the same thing.

[185] My frame on it that I was going to say is this is a product acquisition, but what the product is, is the product is the juice that flows through the Disney flywheel.

[186] and this diagram that Ben was talking about, Walt Disney illustrated it by hand.

[187] It's actually, it's beautiful.

[188] There's Mickey's and Minis and Tickerbells.

[189] Turns out the man was a good illustrator.

[190] Yeah, all throughout it.

[191] But it's this amazing document of business strategy.

[192] And what it is is a flywheel.

[193] I've been thinking a lot about flywheels over the past few months, inspired by the Everything Store, reading the Everything Store and thinking about Amazon and the Amazon flywheel and the definition basically being, you know, how do you create this dynamic in a business where you've got different pieces of the business?

[194] And if you push on one piece of the business, it accelerates the whole system.

[195] So like in Amazon, it's, you know, lower prices lead to more consumers, which lead to more suppliers in the marketplace, which leads to more leverage over those suppliers, which enables you to charge lower prices, which gets you more consumers, which gets you more suppliers and more leverage and on and on and on.

[196] For Disney, you know, the actual diagram is quite complicated, but the nodes in their business are films and tent pole, to use the media industry term, going way back to my days as a media investment banker here, content and franchises at the center, and then the parks and the rides and television and music and merchandising and publications you know comic books and everything flowing through that system and so to me Star Wars is like just a great juice is probably the wrong word but like a great car to put on that track yeah I like that way thinking about it too all right next section uh technology themes uh what would have happened otherwise oh yeah Which we almost skipped, but I think could be interesting here.

[197] I'm not sure David and I totally agree.

[198] What would have happened otherwise?

[199] So, Lucas sat on this for, I don't know how long.

[200] 40 years.

[201] Yeah, but from not, he started saying in 97, no plans to make the sequel trilogy.

[202] You know, I've made the original.

[203] Oh, sat on Star Wars.

[204] Yeah, yeah.

[205] I mean, we haven't seen anything since 1997.

[206] And he's been adamantly saying, I will never produce more Star Wars.

[207] blah, blah, blah, blah, blah.

[208] And he's also been saying...

[209] I'm glad he didn't.

[210] Howard the Duck.

[211] And not only that he wouldn't, but saying that he wouldn't license into anyone else either.

[212] And, you know, I think that maybe that's just like, that'll wear out over time and this thing has too much value not to go back and remilk and they would have sold it to somebody else.

[213] But I think the circumstances were unique, that this is exactly the sort of thing that Disney was acquiring as part of its new strategy going forward, that there was a relationship.

[214] and trust there from from Lucasfilm not only with um the relationship with Iger but also you know that um you know they watched uh Lucas watched jobs take Pixar from him be extremely product focused about it and very hands on and very intentional to keep that thing separate and then watch the fact that Disney was able to shelter it and when Disney was able to keep that thing separate and nurture what made it special and you know I don't I get the sense that Lucas doesn't have that trust lightly, that this wouldn't have been sold to someone that he didn't feel would, you know, keep it in that sort of form.

[215] So this was inevitable?

[216] Well, I don't think it wouldn't have been Disney or no one, but it's hard to imagine this falling into place with a company other than Disney.

[217] Could you imagine Fox owning Star Wars?

[218] Well, I mean, what if, I mean, that's just as crazy as five years ago saying, Can you imagine Disney owning Star Wars?

[219] Yeah, but, I mean, like, there was Disney and Lucasfilm have always had a tight relationship.

[220] I mean, there's the Star Tours ride, there's the Indiana Jones rides, you know.

[221] Well, is it possible that Lucas film would just not have produced more films that George Lucas would have retired?

[222] It would have made boatloads of money off the merch for LM.

[223] Yeah, and like it's just not a company that produced films anymore.

[224] It was a defunct.

[225] Yeah, it's interesting, right?

[226] And that kind of gets to, if you think about acquisitions as a form of investing, which they should be, it's just one that most companies tend to be pretty bad at, you know, at the core of investing is about identifying, it's about identifying mispriced assets.

[227] And so if you, if you're Disney, Bob Eiger and Disney's famed technology and strategy group and M &A group, and you're looking at Lucasfilm and the worth of Lucasfilm sitting there as an independent entity was X, call it $4 .1 billion.

[228] But was that mispriced relative to the opportunity that Lucasfilm had?

[229] I think, you know, if the Force Awakens is any indication and, you know, I think that the not -so -secret secret in that I am just, like, beyond excited about is, you know, we're not going to have to wait too long to see Star Wars land and all the spinoff movies that they've already announced and everything coming down the pipe.

[230] I don't know.

[231] I mean, this is the part where I'm going to say, there's a spoiler alert.

[232] There's a couple seconds if you'd like to turn the podcast off.

[233] If Disney didn't acquire Lucas film and no one did and it laid dormant, then we would have Han Solo forever and Han Solo wouldn't be dead.

[234] I'm so sad.

[235] Well, you know, I saw in doing research for this, I think the second Star Wars spin -off movie that Disney's going to make is a Han Solo Chronicle.

[236] Yeah, the first being Rogue One and the second being the first of the chronicles following Han Solo.

[237] Man. So that's, this kind of amazing.

[238] I mean, we, we've got five films queued up before 2020.

[239] I mean, let's, let's review the finances so far from the Force Awakens.

[240] So already, it's made $1 .78 billion on.

[241] That's incredible.

[242] Yeah, recording this on January 14th.

[243] That's including domestic and international, not including any merchandise.

[244] Less than one month.

[245] Yeah.

[246] Just box office receipts.

[247] On a $200 million budget.

[248] now if you look at the prequels as a whole remember that's amazing well yeah it's the most incredible film you know as a business ever created on every metric literally every metric so you know 4 .1 billion that's that's the number to hit here at some point as as i alluded to earlier jenny and my wife and i went to disney world over new years which was amazing and the number of Kyleo Wren lightsabers with cross guards And having a crossbow It's so stupid You're just going to cut yourself It doesn't vote well When they're hot lasers What it comes It's useful in the One of the battle scenes I think it does More harm It's like We can have a whole Different podcast about this That could be our next podcast All right So vote in the comments If you want to hear it So we're trying to get to 4 .1 billion, right?

[249] We're already 1 .78 of the way there, minus the 200 they spend on it.

[250] I mean, it's not quite like that, but if you want to pencil it out, if you compare that to all of the prequels, the first one, which it's hard even speaking of these when really they don't exist, but the first prequel made a billion dollars, the second 848 million, the second 649 billion.

[251] So total, the prequel trilogy made 2 .5 billion on on theater tickets.

[252] And, like, we could see that alone from the Force Awakens.

[253] Easily, I think.

[254] Before we get any distribution outside of theaters.

[255] And so we're already looking at that.

[256] The economist quotes that they imagine that $5 billion in Star Wars licensed products will be sold in 2016.

[257] And I don't, you know, judging by your experience at Disney World and the Star Wars toasters and, like, everything we're seeing everywhere.

[258] Disney has the most incredible licensing team in the world, and they're taking full advantage of Star Wars.

[259] It is, it is, they got an Instagram bargain on their hands.

[260] Yeah, well, maybe not quite Instagram.

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[280] Let's move on to tech themes because I think this is a good segue.

[281] You know, as I was thinking about this, you know, what technology theme does this illustrate for you?

[282] I was sitting here and I was thinking, you know, this is our sixth episode.

[283] We should have saved this for episode seven.

[284] That would have been appropriate, but not as timely.

[285] Yeah.

[286] And the companies we've done so far for a show that's ostensibly about technology acquisitions.

[287] We've done Pixar, Instagram, Twitch, Bungy, Siri, and now Lucasfilm.

[288] You could argue that that's five media companies and one technology company in Siri being the technology company and everything else being, yes, a technology company, but also a media company.

[289] And what's interesting for me, you know, this highlights a couple of things, which we've mentioned before on this show.

[290] But one, you know, as a, I don't know if I need to pay any royalties on this phrase to Andresen Horowitz.

[291] They probably trademarked it, but like software is eating the world.

[292] Two, I actually like this phrasing of it better.

[293] This is from an old version of the Sequoia website that they've since changed.

[294] But they used to have a section on there called something like what we believe or like what we've learned over 40 years of venture capital or something like that.

[295] And one of the phrases was technology is the best amplifier of a business.

[296] It rings true of Paul Graham's recent technology as a lever.

[297] Yeah, exactly, exactly.

[298] And if you think about technology as a lever for it always has been for Lucasfilm.

[299] Oh my gosh, I -LM.

[300] Like, they were doing things that were absolutely unheard of.

[301] So both within Lucasfilm itself, but then also, you know, now as part of Disney, I mean, there's the whole Disney flywheel, but like, I think one of the coolest parts about episode seven or coolest, you know, sort of things that, business things that happened around it is Disney didn't do a big, marketing blowout budget for like who in the world didn't know that the force awakens was coming out this past December what do you mean they didn't they didn't do a big marketing budget like there was more media for the force awakens than i've ever seen for a movie before yes and it was free from technology from social media so there's there's a tremendous amount of earned media there but a tremendous amount of earned media and of course they had a they had a marketing budget for for the film and i believe it was about a hundred million dollars but it was was on the low end for big tent pole movie releases.

[302] And actually, there are a few interviews with Bob Iger about this, or stories.

[303] There's one in the Wall Street Journal, and I think one in Fortune, where he really pushed the company to be thoughtful about this and say, hey, do we need to spend a huge amount of traditional marketing on the Force Awakens?

[304] Yeah, it's really interesting.

[305] I mean, I saw there's definitely some paid media where, or leveraging of internal assets where I mean at Sports Center the day before the movie came out there was a 15 minute segment in the middle of Sports Center on the athletic training behind Star Wars as a gigantic star it was incredible and I'm like I need to watch that very nice Disney owned property but I mean the the amount of like memes that started from it of like people taking pictures of weird Star Wars products and then posting them on Instagram and Twitter and like that there was that hashtag it was like only Disney or something like that and I mean that Reddit was just they they they knew where people were and they took full advantage of their ability to spread content virally.

[306] Yep.

[307] Second theme for me, which I've already talked about, is just illustrating the power of the flywheel, probably more so here than technology being an amplifier because at the core, Lucasfilm, probably less so than Pixar and Twitch is a technology business.

[308] I mean, it is.

[309] But the power of the flywheel, both within Lucasfilm, and within Disney is incredible here.

[310] Yeah.

[311] It's interesting.

[312] I was thinking, you know, a lot of times we talk about themes.

[313] We talk about the technology themes and other ones, the acquisition themes.

[314] This almost feels like a Facebook style acquisition where Disney is acquiring a portfolio of, you know, third -party brands that they really are learning from, but not roping in in the wrong way.

[315] They're leveraging the Disney assets and the things that Disney does best merchandising and a lot of this media distribution.

[316] But they're not – well, actually, here's the best litmus test of all.

[317] There was no Disney logo at the beginning of Star Wars.

[318] I mean, we didn't have 20th Century Fox.

[319] We didn't get the fanfare.

[320] And, like, God did my heart sink.

[321] But I'll take it as a compromise for we didn't get the castle.

[322] And it was – Of course, I couldn't stop thinking about this during the movie of how good Disney is at just, like, letting this thing be what it is, contributing its own assets where they make sense and learning from it in a very slow hands -off way.

[323] And the trend there is, I mean, Facebook is the shiny example so far of companies that know how to do really good kind of siloed acquisitions where you don't mess it up too much.

[324] And look at Instagram from the day it was acquired to today.

[325] You know, you look at what's at from the day it was acquired today.

[326] That is the theme of the modern acquisition that goes well.

[327] And I think it's a major theme of this show.

[328] You know, look at all the episodes we've done.

[329] You know, they've all, the successful deals have all been this style of acquisition.

[330] Pixar, Instagram, Twitch, Bungy to an extent.

[331] As we heard Ed talk about, you know, they had their own office.

[332] they would knock down the walls.

[333] You know, they kept their culture.

[334] And then the acquisition we did that hasn't gone so well is the one that didn't take this approach in Siri.

[335] Yeah.

[336] And I think to distill it down to a more catchy thing than that long version I articulated before, I think it's amplify quickly, integrate slowly.

[337] Yeah, because there's no question that Disney is.

[338] integrating Pixar, Lucasfilm, Marvel.

[339] You look at the ride.

[340] Yeah, absolutely.

[341] Absolutely.

[342] I just never want to see a world where Luke Skywalker faces off against Iron Man, right?

[343] Like, we better not see combining of universes.

[344] I think we'll have to go back and revise this episode if that happens.

[345] We're moving from the CDN.

[346] Yeah.

[347] I never got Batman versus Superman.

[348] All right.

[349] On that note, any other themes you want to add, Ben?

[350] I don't think so.

[351] Great.

[352] What's your grade?

[353] I'm going to give it an A and not an A plus, even though financially, I think, spectacular.

[354] But I think the thing that we will see in the future is, is Disney able to produce content like this without gigantic acquisitions from now on?

[355] Because there's only so many pieces of gigantic content houses that they can pick up.

[356] There was some stat.

[357] I was looking at the top 25 movies from last year, and like 21 or 22 of them were rebooted.

[358] I guess Star Wars isn't a reboot, but unoriginal storylines, unoriginal assets.

[359] And you compare that with like 1985, and it was like three of the top 25 were sequels.

[360] And, you know, we're seeing the same thing happening in entertainment today that's happening elsewhere.

[361] And it's, you, you, in movies, you know, they're going to spend one to $200 million producing what's going to be for sure a big hit.

[362] And all the experimentation has moved to television.

[363] So that's the whole kind of like startup scrappy.

[364] We're going to try one little thing, small investment.

[365] If it works, we'll double down.

[366] Like, what does that look like for feature film content in the future?

[367] And when Disney runs out of Star Wars movies to make and runs out of Star Wars like, franchises to buy, how do they continue?

[368] And what does that flywheel look like after 2025?

[369] Yep.

[370] I was going to go down the same path.

[371] I'm going to give it an A -minus, but for this reason, thinking about Lucasfilm versus Pixar, Lucasfilm is a depreciating asset.

[372] It was a mispriced one that Disney correctly identified, and they're going to be able to get a ton of juice out of it by feeding it through their flywheel, and that'll go on and on and on for a long time.

[373] But fundamentally, there's not a, it is just content.

[374] There's not a moat there, you know, maybe there is an ILM in their technology to the extent that that's differentiated.

[375] But the moat is Disney.

[376] And what's interesting is Pixar, I think, was different.

[377] You know, their moat was people, which is slightly, arguably more ephemeral, more ephemeral than an organizational or a process or a technology moat.

[378] But Pixar, for Disney, I think, has been an appreciating asset because the process that it brought the ability to continually generate new, relevant, successful content.

[379] Maybe they can apply that to Lucasfilm, but I don't think Lucasfilm itself is going to be that gift that keeps on giving.

[380] What are you talking about?

[381] Indiana Jones is going to be like...

[382] Yeah, but that's just one way.

[383] Just one more existing content franchise.

[384] Yeah, like will Lucasfilm, the division of Disney, come up with an entirely new franchise?

[385] And will they go spend $100 million to make that movie that is the new Lucasfilm franchise?

[386] eyes, unlikely.

[387] The question is, will they be able to do it successfully within Walt Disney Studios?

[388] Yep.

[389] And here's the question, right?

[390] I mean, financially, probably Lucasfilm in the medium term is going to be a better acquisition than Pixar.

[391] And, but in the long, long term, in terms of, like, extending Disney's competitive advantage and, uh, and mote around their, moat around their flywheel to mix two metaphors.

[392] I feel like Pixar is going to add longevity and Lucasfilm is like a, it's like a turbo boost.

[393] Yeah.

[394] Yeah, I like that.

[395] Well, that's what I got.

[396] Me too.

[397] On that note, happy 2016, everybody.

[398] May the Force be with you.

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