Walt Disney Studios’ And Its Star Wars Dilemma
Over the course of his long career, Alan Horn, the chairman of The Walt Disney Studios (‘Disney Studios’), has made dozens of big bets on mega-budget films, would-be blockbusters with wide appeal that cost more than $150 million each. A remarkably high percentage of those bets have paid off — but not all of them. You can win big, and you can lose big when you follow the blockbuster strategy and produce eight big budget tentpole films rather than three times as many low and mid-budget films.
When he was president and chief operating officer of Warner Brothers, and now at Disney, that was the strategy Horn followed. Looking at Horn’s experience, this strategy has actually worked. Still, as he and his boss, Bob Iger (chairman and CEO of the Walt Disney Co.), and the producers of the latest Star Wars movie are getting ready to enter the Dolby Theater for the premiere of Star Wars: The Force Awakens, Horn is nervous. He’s making the big decision here; a decision that requires making use out of a huge bet. Will this $200 million bet pay off? And, given the state of the movie business and the structure of the Disney Studio, is this blockbuster strategy something worth pursuing in the long term?
According to my observations, Disney Studios’ tentpole strategy has often proven to be very successful — especially when choosing not to enlist the help of financing partners. In particular, under the Disney umbrella, eight of its big films have usually been combinations of both commercial and critical successes. In addition, some have earned nominations at the Academy Awards. Some franchises have lost their appeal over time, some films have been box-office flops, and some films have been critical disappointments — which is why it all depends on the creativity behind the films (e.g. creative storytelling, “brain trust,” “story trust”), a good idea, imperative research, and choices of casting the right talents. Not only does Star Wars: The Force Awakens embody all of those qualities, but it also has the three components required for a tentpole strategy (by Disney) — intellectual property, the need to be able to afford it, and the need to have the courage to do it. More importantly, Disney’s approach towards new versus existing properties has proven to be successful, such as with its live-action features of classic remakes (e.g. Cinderella, Beauty & The Beast, The Jungle Book) — all under the right financing structure.
Without a doubt, Alan Horn holds a powerful position at Walt Disney Studios — meaning, disappointment is what probably comes last on his mind. To make the most out of the company’s franchises, one of the things he can do (and probably does) is carefully look over the tentpole strategy with someone like Bob Iger, and evaluate whether or not it’ll work for a specific franchise, such as Star Wars. Since a lot of money goes into these franchises, it’s often best and wise to consider how these franchises (including their strategies) will benefit a big and successful company, like Disney, in the long run. It also would be wise to get a clear idea of how other blockbuster film franchises and films have done in the past at Disney, so to make sure what they’re making is worth a reasonable bet. These sorts of strategies will also help with other and future films in the long-run; not just franchises.
Because of its history, along with being one of the most beloved and popular franchises in the world, Star Wars: The Force Awakens would definitely turn out to be a worthy bet for Disney Studios. It’s also Disney’s way of staying fresh and showing the audience something it has likely never seen before, and has always wanted to see. It also leaves fans (from all over the world) wanting more out of Star Wars, and appreciating its continuous legacy. With its global fan base, talented casting, creative storytelling, producing the right mix, and ensuring that it is not some sequel that reproduces the same thing, I do not see why it would be deemed an unwise bet, or investment. If this is something the audience has been looking for, then why not bet big on it? Most importantly, Disney does all the necessary work, which usually takes a certain number of years, to ensure that a movie will be a major blockbuster hit — especially under someone, like Alan Horn, who carries a breadth of knowledge and expertise.
