Sequels are bad when...
Particularly in the visual medium --- i.e. Hollywood --- sequels seem to mean, more and more, simply rehashing material that may not even have worked really well last time out (creatively speaking), but nonetheless, audiences adored and spent big bucks on with their attendance. And some studio executive noticed and thought to him/herself: we can make a potful of money by just doing the exact same thing again. Because I’m going to demolish a sacred cow and say that most people, when they go to watch films, are not going in order to be intellectually or imaginatively challenged; they just wanna be entertained, frequently in a fairly mindless fashion. I suppose we could say it’s rather like going to the bar to drink yourself insensible, except without the messy effects of being drunk and hung over the next day. (Although some films do leave a nasty taste in your mouth, metaphorically speaking.) Case in point: the most charitable thing I can say about the Star Trek reboot films and the new Star Wars film is that they’re extremely derivative, really short on anything especially new or creative. (Both being done under the aegis of J.J. Abrams, I note. Although I don’t dislike everything he’s done. I liked Fringe... although you could argue even that was a rehash of The X Files.)
Now, before you come to the conclusion that I am some sort of unbearable, hoity-toity snob, let me just say I have nothing against people being entertained. Even mindlessly. From time to time. We don’t always have to be watching stuff like The Iceman Cometh. I’ve been known to cometh home from a hard day/week at the salt mines emotionally and/or intellectually drained, and just want to watch a film or play a video game best described as big, dumb and stupid. But not all the time, in a steady diet of drivel.
Sequels are good when...
They advance the story they’re telling by giving their audience completely new developments, not just warmed over versions of what happened before.
So sometimes, we’re not even really talking about sequels at all.
Case in point: Tolkien intended The Lord of the Rings to be one story. Period. The Two Towers is not a sequel to The Fellowship of the Ring, and The Return of the King is not a sequel to either. It was his publisher who said they had to be three separate books, presumably for economic reasons. Although the first copy of The Lord of the Rings that I owned was actually done in one long volume, minus most of the appendices. (First copy? you ask, puzzled. Well, yes, of course. I have --- umm, let me see --- three copies of LOTR. Because the first was wearing out, so I had to get a second, and then of course the third was a really good deal, you see, and... never mind.)
Another (much less famous) example is my own novel, Gryphon’s Heir. On its final publication draft, it clocked in at somewhere around 186,000 words, and there’s a cliff-hanger ending. (Loved the story, said a friend after reading it. Hated the ending, she continued, but I understood why you did it.) So is its follow-on, Gryphon’s Awakening --- currently under construction, by the way --- the sequel? Well, by my own definition today... not really. It’s all part of the same story. I just found a good spot to end the first book, which was about as big as it realistically could be and not cost the earth to buy, and brought it to a halt (temporarily). And yes, he said defensively, I’m not ashamed to admit it ends on a cliff-hanger. After all, one wants the reader to come back for more, doesn’t one? Besides, Professor T did the same thing with LOTR, particularly at the end of The Two Towers: “The great doors slammed to. Boom. The bars of iron fell into place inside. Clang. The gate shut. Sam hurled himself against the bolted brazen plates and fell senseless to the ground. He was out in the darkness. Frodo was alive but taken by the Enemy.” Wow! What a place to stop! Boom! Clang! Huzzah! Let’s get on to the... uh... sequel! Continuation! Whatever!
Because I’m stoked and can’t wait!