Videogame expo collapses under its own weight
E3, the video game industry's orgy of sight and sound, abruptly downsizes and moves to a more subtle tone.
NEW YORK (CNNMoney.com) -- The dueling - and deafening - two-story tall speakers of Electronic Arts and Activision have fought their last battle. E3, the industry's annual trade show, which is known for its overwhelming sights, sounds and excess, is scaling down.
The Entertainment Software Association, which hosts the show, confirmed the weekend rumors Monday, announcing plans for a smaller event - one without exhibitor booths, without scantily clad models and without tens of thousands of people choking the aisles of the Los Angeles Convention Center.
"I think this decision has been coming for three or four years at least," said Doug Lowenstein, president of the ESA. "As the industry has evolved, as the business has evolved and as the retail channels have evolved, I think companies began asking the question if the event as it currently operates made sense for the modern video game industry. If the industry was starting today, would you create E3? Probably not."
At issue with show attendees was the bang for the buck. Companies like EA (Charts), Sony (Charts), Microsoft (Charts) and Activision (Charts) routinely spent millions of dollars to display upcoming games and gaming systems. As the show has grown and evolved, many felt they were not seeing an adequate return for their investment.
The 2006 E3 (held in May) attracted more than 60,000 reporters, bloggers, retailers and analysts. Next year's event, said Lowenstein, will likely have 10,000 or fewer attendees. It will still be in Los Angeles, but will be an invitation only event - and will be held in July. Gone is the the LACC home - which will be swapped for a pair of "headquarter hotels" somewhere in LA (the location has not yet been announced - and may have not yet been picked).
Press conferences from the industry's biggest companies - Sony, Microsoft and Nintendo - are still expected to be held, likely with breakout sessions afterward allowing attendees to play the games. Publishers have traditionally used the pre-E3 press conference to unveil new products, announce price cuts and discuss their holiday plans.
Aside from the money spent on glitzy events and cavernous booths, E3 carried an additional cost. Developers were often put under tremendous pressure to deliver a playable level or two from a game that's often still in the embryonic stages. Whether the two extra months will alleviate that is one of the mysteries of the new E3.
While the show's scale will be dramatically reduced, at least one remnant of the old E3 will likely stay alive, said Lowenstein: The parties. Major gaming companies typically tried to outdo each other with swank affairs featuring top artists. Musicians who have played at E3 parties in recent years include Sheryl Crow, The Black Eyed Peas, Liz Phair and The Killers.
Why keep the entertainment budgets high? Because the new E3 is tailored specifically for the media.
"What E3 was about in the early days was writing retail orders and creating awareness for the industry - but retail has changed. ... It's not a selling show anymore," said Lowenstein. "It became clear that the audience we want to speak to is primarily a media audience. Yes, retailers and financial people will be included. But primarily it's about creating visibility for the publisher's products."
While the idea of creating a gaming show that welcomed the gaming public with open arms (as the Tokyo Game show does each year) was briefly considered, it never really stood a chance.
"We have never seen much point in doing that," said Lowenstein. "For companies attending, there's a very, very substantial cost to make the presence they need - and there's a huge security cost, much higher than the show in recent years. And when you're all said and done, you have to look at what you've accomplished. You've let 50,000 or 60,000 people from Los Angeles see games. ... I don't think there's much return in that."
I'm a veteran of 10 E3s. When people ask me to describe the show, I always find myself falling back on the same phrase: "an orgy of sight and sound". It's a wonderland that can be overwhelming for your senses - and I've seen many people flee after an hour or two on the show floor, unable to handle the sensory overload.
I've seen the sound wars escalate, the crowds grow thicker and every year the show wears me down a bit more. And though my feet would scream and I'd average, at best, four hours sleep per night between attending events and filing stories, you'd never catch me complaining about it.
Indeed, E3 evolved into a circus, but there was something energizing about it - and that energy served as a tentpole for gamers everywhere. It was also a place where diamonds in the rough often found a place to shine. Would 2004's "Katamari Damacy" - one of the most lovingly reviewed games in years - have even been released in the U.S. if it hadn't been for E3? Quite likely, no.
Smaller publishers, meanwhile, may find it even harder to break through to an audience with the newly revised show. While major publishers can afford large hotel suites to show their wares, it's doubtful smaller companies can. (The ESA is considering offering those companies space in a hotel ballroom.)
I could be wrong, of course. Plans for the 2007 are very fluid at this point - and nobody, not even the ESA, is really sure what it will be like. While there will still be plenty of news coming out of the show - and as encouraging as it is to see changes made to ensure the show doesn't die off due to lack of support (as Comdex famously did in 2004) - it feels as if the industry is saying goodbye to an old friend.
Morris is Director of Content Development for CNNMoney. Send him an email at Chris.Morris@turner.com