The IP Paradox: Why Hollywood’s Reliance on Licensed Properties is a Double-Edged Sword

Michael Eisner, former CEO of Disney, has acknowledged the entertainment industry’s biggest blind spot: its failure to adapt valuable intellectual property into new formats and technologies. This inability to evolve has led to repeated stumbles in gaming and other areas of media.

The industry’s tendency to rely on licensed properties is a strategic necessity that also poses creative obstacles. On one hand, leveraging recognizable brands can attract audiences and drive revenue. Disney’s acquisition of Star Wars, for instance, was a masterstroke that paid dividends through box office success and merchandise sales. However, this approach raises questions about the long-term sustainability of relying on established IPs.

Eisner noted that companies that rely too heavily on licensed brands risk exhausting audiences through endless sequels. This is evident in Disney’s handling of the Star Wars IP, which has resulted in a glut of films and spin-offs leaving fans feeling fatigued. The gaming industry, with rising development costs and increasing competition for consumer attention, is grappling with these issues.

Delphi Interactive founder Casper Daugaard’s approach to building interactive experiences for hardcore fans of franchises like James Bond and FIFA represents a shift towards creating engaging content that resonates with audiences on a deeper level. However, leveraging IPs may be a necessary evil in the media landscape, but it comes with drawbacks.

Eisner’s comment “we all failed” when attempting to extend valuable IP into new formats serves as a cautionary tale about the limitations of this approach. The industry’s repeated stumbles in gaming are a testament to its failure to adapt and innovate. As the video-game industry continues to evolve, studios must find ways to balance the need for established brands with the desire for innovation and creativity.

The key, according to Eisner, is not to rely solely on IPs but to create great games that nobody’s ever heard of after establishing a portfolio of successful properties. This nuanced approach requires studios to prioritize creativity and originality over relying on licensed brands as a means to an end.