LucasArts was, at one point in time, one of the leading video game studios, responsible for many groundbreaking adventure games like Sam & Max, the benchmark FPS Star Wars: Dark Forces (and its sequels), and Star Wars: Battlefront (the sequel to which is one of the best Xbox games ever published).
But the studio faltered during the last decade. Battlefront II was the best-selling Star Wars game of all time, yet the studio let an entire console generation pass without a follow-up. Newer games were panned, commercially and critically, and in retrospect, Battlefront II was the last great hurrah of a dying behemoth.
So why did the studio die? George Lucas.
Lucas acted like the studio was his toy, not a business. He’d drop in, change everything on a project (wasting literally years of work for the team), then ignore LucasArts for a couple of years, until the next bout of interference. (In the movie industry, this is known as “executive meddling”.)
The entire sorry story is told in this post over at Kotaku. Take a look.