George Lucas is giving a word of warning out to movie studios who have plans to shift their dollars to big-budget feature films. His message? DON’T!

The man who put BIG in Budget is now backing off and telling movie makers that the way to go for the future are smaller films and newer methods for distribution, specifically the Internet.

George is also putting his money where his mouth is when it comes to the future of Lucasfilm.

“We don’t want to make movies. We’re about to get into television. As far as Lucasfilm is concerned, we’ve moved away from the feature film thing because it’s too expensive and it’s too risky. I think the secret to the future is quantity,” Lucas said in a statement during a groundbreaking ceremony at the School of Cinematic Arts at USC.

Excuse me George. Did I hear you say “quantity?” Moviegoers and buyers are a lot more sophisticated than when you and I were kids, George. They want a lot of quality for their buck so I hope you plan on including some quality with that “quantity.”

“For that same $200 million, I can make 50-60 two-hour movies. That’s 120 hours as opposed to two hours. In the future market, that’s where it’s going to land, because it’s going to be all pay-per-view and downloadable,” he surmised. “You’ve got to really have a brand. You’ve got to have a site that has enough material on it to attract people.”

“If you don’t do very many movies, and you’re really lucky, and you really know what you’re doing, you can get away with it. But you know at some point you’re going to lose a game.”

Lucas is convinced that most Americans are foregoing the theater going experience to see their movies and have opted for the more accessible medium of the internet and renting choices like Netflix. While I am prone to go along with George’s summation on moviegoing, I still believe many like that exhilarating feeling of seeing a really fine film on a very big screen, surround sound, the smell of popcorn, sitting in a darkened theater full of total strangers all sharing what you too are experiencing as you watch your hero on the silver screen. That, I don’t think can ever be replaced by the internet or sitting at home watching on a computer screen or even a big screen home entertainment center.

“I don’t think anything’s going to be a habit anymore. I think people are going to be drawn to a certain medium in their leisure time and they’re going to do it because there is a desire to do it at that particular moment in time. Everything is going to be a matter of choice. I think that’s going to be a huge revolution in the industry.”

That being said don’t look for Lucasfilm anytime soon to offer its own online distribution. “Having had a lot of experience in this area, we’re not rushing in,” he said. “We’re trying to find out exactly where the monetization is coming from. We’re not interested in jumping down a rat hole until such time as it finally figures itself out.”

Columnist David S. Cohen, of Variety, makes an accurate observation when he says, “Nor is Lucasfilm’s exit from features instant or absolute. ‘Indiana Jones 4’ is still in development.” Even George admits there are still a few theatrical irons still in his fire. “Steve (Spielberg) and I are still working away, trying to come up with something we’re happy with. Hopefully, in a short time, we will come to an agreement. Or something,” Lucas admitted. And Lucas Animation does plan to start making feature films. “Right now we’re doing television, which looks great. I’m very, very happy with it,” he said of his toon division. “And out of doing the animation, we’re getting the skill set and the people and putting the studio in place so we can do a feature. But it’s probably going to be another year before we have the people and the systems in place to do a feature film.”

So exactly where is George, creatively, these days? Cohen says, “He calls himself ‘semi-retired’ but reiterated his plans to direct ‘small movies, esoteric in nature,’ after his other projects are launched. He expects to serve as exec producer on the two features and the TV shows, including a live-action ‘Star Wars’ skein.”