Why Steven Spielberg Gets 2.5% of the Profits for Star Wars

You wouldn’t know it now, but back before Star Wars became such a huge success, George Lucas was just a young filmmaker worried that his movie was going to fail. The year was 1977, and Lucas had taken a trip to see his friend and fellow filmmaker Steven Spielberg on his set of Close Encounters of the Third Kind.

Lucas was already a nervous wreck, believing his idea hadn’t been fully realized and that the movie was going to turn out to be one in which only little kids would be interested in. After spending a few days on the set of Spielberg’s movie, Lucas’ confidence was shot even further. He was convinced that Close Encounters was going to far outshine Star Wars, which would then pale in comparison.

Lucas was so sure that Spielberg’s film was going to be so much more successful than his own Star Wars, that he offered Spielberg a wager. Lucas suggested that the two swap 2.5% of their respective points per movie, to which Spielberg gladly accepted, saying he’d be happy to take that gamble. Points refer to how much each film makes in profit after recovering their costs. So, basically, they were exchanging 2.5% of each movie’s profit to the other.

Star Wars went on to debut that same year on May 25 in less than thirty-two theaters, adding eight more that weekend. Although the amount of opening theaters would be a joke today, the movie still broke box office records immediately, becoming one of the first movies to become known as a blockbuster. Lucas obviously had no idea how successful Star Wars was going to be.

In fact, Lucas was so afraid that the movie was going to be such a failure, that he and his wife had intended to be in Hawaii on vacation that weekend. However, Lucas’ had forgotten that the movie was opening on that Wednesday and instead, spent most of the day in a sound studio in LA. When he met his wife for lunch, they discovered a very long line of people actually waiting to get in to the theater to see Star Wars. Nonetheless, Lucas was still skeptical of the movie’s success, even after hearing exuberant reports from the studio.

It actually wasn’t until Lucas and his wife were on vacation in Hawaii that he realized he’d become a very wealthy man after watching Walter Cronkite discussing the enormous crowds Star Wars had drawn in. As a matter of fact, a telegram was actually sent to Lucas’ hotel asking for funding. The request was from Francis Ford Coppola in regards to finishing his movie project Apocalypse Now.

Lucas’ wasn’t the only one to become an instant success. Cast members became overnight stars and even the technical crew were asked for autographs. Harrison Ford reported that when he went to a nearby record store in order to buy an album, over-zealous fans literally tore his shirt in half, tearing part of it away.

Back to why Steven Spielberg gets 2.5% of the profits for Star Wars, the movie was made for what was a very small amount for such a huge movie, eleven million dollars. It went on to make four-hundred and sixty million dollars in the US alone. Lucas and Spielberg essentially traded one another 2.5% of their own movie’s profits to the other.

Although Close Encounters didn’t come close to what Stars Wars has earned, it still earned over three hundred million at the box office. However, Star Wars keeps on earning and Spielberg keeps on collecting. His deal has netted him about forty million dollars, give or take a few thousand. Not bad for a little bet between friends.

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