Iger: Disney will "protect" Star WarsNovember 5, 2012: 10:42 AM ET
Apprehensive Star Wars fans should take note of recent Disney history.
By Jennifer Reingold, senior editor
FORTUNE -- You've probably seen at least one of the memes related to the October 30th, $4.05 billion purchase of Lucasfilm by the Walt Disney Co. by now. Was it Mickey in Darth Vader's suit, saying "That Jedi Mind Trick Sh*T Really Does Work" on Tumblr? Peter Pan and Tink floating in silhouette in front of the planet Tatooine on Conan O'Brien? Buzz Lightyear as the hero of Star Wars 7?
But what all those who have chimed in on the deal don't get is that -- ironically -- Disney (DIS) is the only company out there that understands how to keep the Millennium Falcon from crashing into Space Mountain. The secret of Disney's success with acquisitions ESPN, Pixar and Marvel -- and the number one rule of its CEO and Chariman, Bob Iger -- has been to let each company's unique culture stay that way, without too much forced synergy coming from the top. (Read Fortune's earlier Disney story.) "I'm going to do this one the same way," he told Fortune in a lengthy interview. "If the culture is important in terms of the creative environment, then that will be protected."
Aquiring CEOs always say that, of course. But in Iger's case there is precedent. In an interview earlier this year, George Bodenheimer, Chairman and former President of ESPN, emphasized how careful Disney has been not to trample on the ESPN way. "I credit Disney with recognizing that the culture of ESPN is a major part of its strength. You could see an acquiring company going a different way." At Pixar, part which was actually owned by George Lucas before it was sold to Steve Jobs, John Lasseter and Ed Catmull, the same is true; a visit to the campus reveals a culture completely independent, with no evidence at all that Disney owns it. "It's like we're off the grid," said Catmull earlier this year.
There is, however, one big difference from Disney's other deals, in which the company leaders --Catmull and Lasseter at Pixar and Ike Perlmutter at Marvel -- stayed on. Although George Lucas is going to remain a "creative consultant" going forward and his handpicked successor, Kathleen Kennedy, will be the executive producer of the next Star Wars film, he no longer has any say so over the franchise itself. Says Iger: "We have unfettered rights to [Star Wars and Lucasfilm's other properties] going forward. We have complete creative control -- over the name of the movie, how it's made, what's in it. " That requires trust.
Iger, who first got to know Lucas when they worked on the Young Indiana Jones series on ABC in 1990, first broached the subject of buying Lucasfilm in mid 2011, but says Lucas wasn't ready. "I decided not to sell hard at all," he says, "and said 'well, call me when you're ready to talk.'" That call came in June 2012. After due diligence, the real negotiations began, but Lucas never formally shopped the company elsewhere -- though Iger, at one point in the price negotiations, says he suggested that Lucas do so to confirm that his offer was a good one.
As tempting as it may seem to merge Princess Leia with Princesses Ariel and Aurora, Iger, who has described himself as Disney's "brand manager" in the past, say the key is to protect what is still one of the world's greatest entertainment franchises, even six years after the release of the last Star Wars film. Disney's edge is to run its content through Disney's international distribution system -- including its own cable channel, available in hundreds of countries -- and in so doing, bring Star Wars to new generations of fans worldwide. "In the three years since we did Marvel," says Iger, "China and Russia have emerged as huge movie markets in the world. We saw an opportunity internationally both in terms of the box office and on terms of consumer products."
An added bonus for Disney comes with the acquisition of Industrial Light & Magic, the respected special effects firm that has does independent work for virtually every studio in the world -- though one wonders if the fact that it will now be owned by a competitor may cause some firms to stay away.
There is yet another important aspect to the deal that few have noticed: the creeping Silicon Valley influence on a firm so deeply rooted in Southern California. Iger has long championed technology as one of his three uniting principles of the company, and a key competitive edge going forward. "We're moving Disney's center of gravity north," he says, before hastening to add that the corporation will not be relocating. "When we bought Pixar," he says, "John Lasseter said something I loved. The creative people challenged the tech people to create the tools they need to fulfill the creative vision, and vice versa. We can tap into a larger and different talent pool."
Geeks with a thing for Mickey, he's talking to you.