is fabulously wealthy because of a casual accident that changed the course of the movie business.
In the seventies, when he was filming Star Wars, it was seen in the industry as a schlocky niche movie with bad prospects, and was expected to be an expensive failure. At the height of the crisis, when the studio was threatening to can the project, Lucas took a big pay cut as a "show of faith" - something besieged directors of wildly over budget movies sometimes do (see James Cameron and Titanic). The crucial detail of that renegotiation was that, as a token conciliation, Lucas was assigned all of the merchandising rights associated with the movie.
Much like IBM in their infamous OS deal with Microsoft, Fox had no idea what they were giving away. In the late 1970's, movie merchandising was a tiny, almost cottage industry, virtually ignored and utterly insignificant.
Star Wars became a runaway hit, especially popular with children. Lucas, realizing it was his only chance to capitalize on his success, built the first real "movie franchise." He turned his piddling merchandising rights into a multi-million dollar industry, and Star Wars action figures, lunch boxes, video games (first, Atari, and later, Nintendo and others), storybooks, underwear, shower curtains, wallpaper, place settings, etc. flew off the shelves, both because of their novelty, and because of the public’s love for the story. Lucas became phenomenally rich, richer than any director could normally become. Flogging the toys was his only hope of making real money – and he made it make money better than anyone could have possibly imagined. To this day, every time something with the Star Wars name on it is sold, he gets a piece of the action.
The subsequent decades saw the evolution of this accident into the modern film and television industry, which is, basically, an advertising channel. Selling plastic is, and has always been, where the real money is. Subverting the modern arts to do it better was just something no one had had the audacity to undertake on a large scale before.
At first, producers and advertisers were happy with the “subliminal” approach of simply having Indiana Jones eating Corn Flakes instead of Wheaties or flying Delta instead of Pan Am. Later, the camera started to linger, scripts started to contort to accept big name sponsors, and eventually, entire movies were created simply as a vehicle for product advertising (i.e. recent James Bond movies, or the BMW short films they inspired). Considering the relative costs and benefits, it was a great deal. It was really good advertising that might actually make you money. That's what they in the industry like to call "synergy." Television had already gone through a similar metamorphosis; now it was time for the movies to follow suit.
Now Lucas has the benefit of hindsight. Thus, the entire purpose of the Phantom Menace is to sell toys. As is well known in the video game industry, racing game technology is easily licensed, and racing games are relatively cheap to produce. Not long into the initial production of Episode 1, the Nintendo deal was cut, the word came down: Phantom Menace would have a “racing scene” – and thus a tortured, logicless 20 minute interlude involving Anakin racing for his freedom and Liam Neeson betting on it was developed.
Jar Jar is part of a long line of “toy characters” designed by the equivalent of an advertising industry focus group – the same sort of technique that produced the Teletubbies, Barney, and Pokemon (another excellent example of this phenomenon). He’s not designed to entertain you any more than the Phantom Menace is really meant to be a movie, per se. He’s there in a calculated, cold-blooded attempt to sell children a toy.