Can Kathleen Kennedy expand Lucasfilm?

Move signals more 'Star Wars' and 'Indiana Jones' franchise films

Lucasfilm’s decision to anoint Kathleen Kennedy to succeed George Lucas as the company’s topper is likely to mean more Lucasfilm movies — perhaps even more “Star Wars” pictures.

The move, announced Friday morning, makes Kennedy co-chair of Lucasfilm alongside Lucas, who is planning an active retirement that doesn’t include running his corporate empire. She will work alongside Lucas for a time, familiarizing herself with Lucasfilm’s far-flung divisions and projects. Eventually — no timetable has been set — Lucas will step aside and Kennedy will become the sole topper.

In the meantime, Lucas remains co-chair and CEO, while Micheline Chau remains as president and chief operating officer.

Lucasfilm execs confirmed that the choice of Kennedy to lead the company is a signal that the company’s future includes more pic production. Kennedy herself said in a Friday conversation with Variety: “I’m really, really looking forward to not only reconnecting with the relationships I’ve had up there but bringing in new relationships I’ve made over the years. Because what I really love is making movies, and that’s something I hope to bring to the Lucasfilm family.”

Lucasfilm has produced few movies in recent years, and other than “Red Tails,” its pics have been limited to its existing franchises, “Star Wars” and “Indiana Jones,” since the late 1980s.

Chau agreed the selection of Kennedy means Lucasfilm is likely to expand its film slate going forward. “We are a fully integrated entertainment company,” she said, “and everything leverages everything else. Movies are a big part of that.”

Chau added that includes both new projects and existing franchises “Star Wars” and “Indiana Jones.”

“It’s very important to bring somebody in that respects the legacy. But for any company to thrive, we have to continue to create product, and new product is part of the fabric.”

Lucas was bashed by fans and critics for the “Star Wars” prequel trilogy, and with retirement looming, he would be unlikely to embark on any undertaking as massive as a new “Star Wars” pic. In recent years the “Star Wars” franchise has been kept alive through 3D conversions of the six live-action features, an animated feature and TV series of “Clone Wars,” and in videogames. With Kennedy leading a re-energized Lucasfilm management, the chances of more “Star Wars” features will almost certainly improve.

Kennedy said she will step away from producing for Kennedy/Marshall company, which recently inked a two-year overall deal with CBS TV Studios (Variety, May 30).

“Frank (Marshall) is going to continue to run Kennedy/Marshall and do the projects that we’ve been doing jointly. We’ve been scrambling over the last several days to sort out exactly how that’s going to happen,” she said.

Kennedy will also turn producing duties for Steven Spielberg over to Marshall. She has long been Spielberg’s producing partner, and her history with Spielberg extends back as far as “Raiders of the Lost Ark,” which Lucas produced with Steven Spielberg directing.

Spielberg, who keeps an office adjoining Lucas’ at Industrial Light & Magic’s Presidio digs, said in a statement: “Kathy has been a member of both of our families going into a fourth decade, so it does not feel like she is going to another galaxy far, far away. She will get just as much support from me with Lucasfilm as George has given both of us all these years.”

Kennedy, a Northern California native, will commute for now between Los Angeles and San Francisco, where Lucasfilm has its headquarters. She said she has no plans to relocate to the Bay Area but didn’t rule out such a move in the future.

“It’s certainly a place I’d like to spend a lot more time,” she said.

Chau announced Kennedy’s hiring to employees at the company’s HQ Friday morning. She told Variety, “Everyone here was really, really excited.” In any company, she added, “You worry about succession. We have a succession plan — which is a really good thing, and it makes the employees feel safe. You have to worry about your employees, and you have to give them an environment where they feel they can stay and they can thrive.”

Chau also said that there are no plans for Lucasfilm to shed Industrial Light & Magic — a division that Lucas himself has long favored even as the economics of vfx have turned more and more problematic.

“ILM brings something special to the table,” said Chau, “because we are a fully integrated entertainment company. It’s really amazing to me the kind of collaboration we’re seeing between ILM, our animation unit and our games unit. Personally, I don’t think we would ever, ever want ILM not to be part of the family.”

As for Lucas, he has long spoken of his desire to return to making small-budget movies. He recently told Empire magazine that he means to retire and “make hobby films.” He has also criticized the majors for their strategy of making fewer movies with bigger budgets, arguing more movies, not bigger movies, will be the key to success in the future (Variety, Oct. 5, 2006).

Kennedy said Lucas has not discussed the possibility of Lucasfilm producing his low-budget movies.

Lucas also made a point of reassuring one other important group in the Friday announcement.

“I also care deeply about our fans,” he said, “and it was important to have someone who would carry on the passion and care that I’ve given the films over the years.”