The Economics of Star Wars

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This picture is very true. However what it doesn’t explain is exactly how Lucas finances the movies and TV shows. That money he makes from the merchandising is what he uses to self-finance the movies. All the merchandise releases of the original trilogy went into building up ILM and Skywalker Sound.

When Lucas decided to do the Special Editions, he re-released the original versions on home video for the final time (and told people it would be the last time they could get them) and used that money to finance the Special Editions. All the merchandise from those releases and the home video releases of them, then went on to finance the Prequels. The profits from everything the Prequels put out? That went into Clone Wars. As for the upcoming Blu-Ray releases? Well, Lucas is re-releasing all six movies in 3D and that costs money.