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SPOILER WARNING: The following article contains massive spoilers for Rogue One: A Star Wars Story. If you have not yet seen the film, and don't wish to know certain details about it, please save this page, catch a screening, and come back!
One of the best things about Gareth Edward's Rogue One: A Star Wars Story is the fact that it so well balances classic elements and new ones -- and this is especially true in its portrayal of the Empire. We not only get to see Imperial outposts on new planets and different divisions within in the ranks of the fascist government, but also the return of great characters like Grand Moff Tarkin and Darth Vader. It hits so many buttons, in fact, that some may wonder why it doesn't feature the man who is running the entire show: Emperor Palpatine. While that may be a passing thought for fans, the truth is that the blockbuster is a lot better for not including a cameo.
It certainly would have been easy from a practical standpoint to include the Emperor in Rogue One, as Ian McDiarmid is still very active as an actor, but the truth is that his presence would have seriously upset the film. Not only would he have wound up disrupting the balance of power amongst the three main antagonists in the movie -- Orson Krennic, Tarkin, and Darth Vader -- but making an appearance would have also seriously hurt the dramatic flow that already exists between the pre-existing Star Wars movies.
It's worth noting that the villain plot in Rogue One isn't its strongest asset, but there does at least exist an interesting dynamic between the characters that keep the audience invested. And it's a dynamic that would totally go out the window with the arrival of Emperor Palpatine on the scene. Within the film, there is a distinct relationship triangle between Orson Krennic (desperate to get attention for his work on the Death Star); Tarkin (trying to steal credit for the Death Star); and Darth Vader (who is overseeing all operations). In introduces degrees of conflict and tension to the Empire's side of things -- all too important when making a prequel story with a definitive ending.
Because so much time in the film is dedicated to the Rebellion side of things, this is a pretty thin narrative that Rogue One holds on to, but it wouldn't play as well with an appearance from the Emperor. Palpatine would not only serve as an unnecessary distraction, but he wouldn't even allow opportunity for characters to show different colors -- as Krennic, Tarkin and Vader would all just bow at his feet. What's more, it would only serve to make the entire operations of the Empire seem small, as it really shouldn't be that easy to summon the man who is in control of just about the entire galaxy.
Taking that point a step further, there really just isn't any room within Rogue One's story to accommodate a cameo from the Emperor. As it stands, Krennic has to go out of his way -- all the way to Mustafar -- to register his complaints with Darth Vader, and it wouldn't make much sense for him to jump another rung up the ladder, especially when Palpatine doesn't show his face in the proceeding chapter, Star Wars: A New Hope.
For fans like me, who prefer to watch the Star Wars movies marathon-style, there's also something to be said for the way that an appearance from the Emperor would disrupt that experience. When watching the original trilogy, there is a certain level of build-up to Palpatine's arrival -- as he is absent from A New Hope and teased in hologram form in The Empire Strikes Back, only to finally enter the game in Return of the Jedi. Because Rogue One doesn't feature the leader of the Empire, that build-up is still in place, and audiences can continue to enjoy it for generations to come.
In telling the story its telling, Rogue One: A Star Wars Story has courted some controversies in its approach and cameos, but the film definitely made the right call when it came to Emperor Palpatine. Including the character in the prequel would have been a serious mistake that would have not only been a detriment to the narrative being put forward, but would have hurt the saga on a larger level. It was part of the intelligent approach that Gareth Edwards brought to the production, and the film benefits as a whole.