Mego Museum: Let's talk about Star Wars.
NK: The guy from from Fox, who we were very close with, we got Planet of the Apes from Fox, came to us first. He walked into Toy Fair and (he spoke to the wrong person, who rejected it.) The final deal was only a $100,000 guarantee, I mean it was natural for us, we had bought everything else in sight, we had bought Buck Rogers as a favour to the guy at LCI who brought us Superheroes.We bought the Black Hole, we bought Logan's run, which very few people know, I've never seen Logan's Run mentioned, we bought everything in sight, just to protect Micronauts. (Micronauts) were huge business at that time, Star Wars killed Micronauts.
Mego Museum: Tell me more about the Micronauts.
Micronauts came from a company, Marty saw the line in California at the Calfornia Inventors company, (Marty) said I want you to fly out first thing, what time can you be here? I want to show you something, tell me what you think? I walked in there and there was a table with all the Micronauts laid out and I said I think it's phenomenal, the biggest problem we're gonna have is convincing the trade that we're doing all of this and the second problem is we're going to have to do at least three of four commercials to cover the line.
The number that keeps sticking in my mind I think was that 32 million dollars was the peak, that was an awful lot when the company is doing $ 110 (million), It accounted for a third of our volume. To give you a yardstick to measure by, Hasbro was doing about 85 million, the big gun was Mattel at that point with just over 300 million.. Ideal was still around at that point and they were bigger than us but we were about fifth in the world and so we would do anything (in terms of Science fiction properties.
The only (Science Fiction Property) we bought with great expectations, that we thought we could bring market that would be big was Star Trek
Mego Museum: Right, the Movie..
NK: The biggest downer I ever had at Mego was the night we went to the premiere of Star Trek and walked out and said Well, kiss forty million goodbye We thought we'd do forty million dollars on it. We took one look at it and knew it was a bomb, actually it wasn't that much of a success of a movie, it was just enough of one for them to make another one
Museum: The Micronauts were made originally by another company in Japan.NK: Right, (it was) Takara. First we licensed it and we also licensed the tooling, so we worked right off of their tools because they were manufacturing in Hong Kong. We repackaged everything, I did all that Micronaut packaging and we started to make a lot of changes in colours because (Takara's) were all blue and white and we went to the blues and silvers, things like that.
The second year we created all of our own stuff. For example there is a character with the magnets called Baron Karza, did you ever spell Karza backward? It's Azrak.
NK: One of our rivals for licensing was a company called Azrak-Hamway-Remco. It was a dig at their President, Marvin Azrak whose in business to this day.
Neal Kublan Factoid: Did you know Neal's children appeared in many of Mego's commercials, catalogues and packaging?
Museum: So basically with the success of Micronauts, you would license every Science Fiction property just to protect it?.NK: The (trouble with Star Wars) is that nobody in the US divison saw it, it was policy to take it. There was literally no question that we would have taken it, (we took licenses) we knew we never gonna make and the fact is Kenner didn't make it right away.
The first Christmas Kenner sent out to the stores a cardboard catalogue sheet and that built up a demand that subsequently it hasn't waned.
Museum: I remember they were slow to come out but I always thought they'd be 8 to play with my Megos.NK: (the 3 scale) was to get the pricing down, not only to be competitive and they could see that kids couldn't tell what size they were in a commercial.
Plus the films were such a huge success right from the get go, Kenner was caught totally unprepared, when you go into film licenses the only true successes have been Star Wars and Batman
Batman had a life of it's own prior. The first Batman film I closed the licensing deal for Toy Biz. At the time, it was a completely different organization than it is today.
Museum: Was Mego the first to work in the 3 3/4inch format?.
NK: Yeah, we were the first ones to do that format. We were also the first ones to do the die cast characters which was (Eagle Force)
We had hired a great artist named Bill Barron, who started to design (Eagle Force) and frankly if it were up to me I would killed it on the spot
I would have killed it for a very peculiar business reason, at that price point we could have never made enough to cover our debt service which was as much as our volume.
We had debt service on 90 million dollars and at that point interest rates were at 18%., (with the Eagle Force) you have to sell a lot more than you do with high ticket items.
The biggest business for us at the time was that we had pioneered liquid crystal games.