If you haven't already heard, The Electronics Entertainment Expo, North America's largest video game show has been aborted, find the reason why here.
Doug Lowenstein today attempted to spin E3's fall as "an evolution" but confirmed Next Generation's story that the event's status as a mega-show is over. In a release, the trade body also did not deny our reports that all major operators in the industry had pulled support.
The ESA was forced to revamp E3 as a "more intimate" trade show following the news that all the major exhibitors had pulled support. Lowenstein said, "It has become clear that we need a more intimate program, including higher quality, more personal dialogue with the worldwide media, developers, retailers and other key industry audiences."
ESA is calling the show "the new E3Expo" and has stated that it will still take place in Los Angeles, though no mention was made of LACC.
Lowenstein also confirmed that the new event will be media facing and low-cost for exhibitors. "E3Expo 2007 will not feature the large trade show environment of previous years," added the media alert.
ESA head Lowenstein added, "It is no longer necessary or efficient to have a single industry 'mega-show.' By refocusing on a highly-targeted event, we think we can do a better job serving our members and the industry as a whole, and our members are energized about creating this new E3."
He did not mention the circumstances of this decision - i.e. that publishers had said they would no longer pay for an expensive mega-event.
Since Next-Gen broke the story about E3 yesterday, some news outlets have sought to follow ESA's line that this change is some form of evolution. No doubt, they will continue in this credulous line. But the real story here is that this announcement is a device designed to save the E3 brand while attempting to create a new, smaller event over the next few months.
Given the determination of the larger companies to abandon E3, all other publishers had to fall in line. ESA has been left with no option but to paint this as an "evolution".
ANALYSIS: Ten Reasons for E3's Collapse
I was editor-in-chief of the Official E3 Show Daily in 2006, and a few of those produced in the late 1990s. I attended the first E3, and the last and most of the others in between.
I'm sorry that this event has gone, to be replaced by some new thing, much smaller in scale - more 'intimate' is the euphemism of the moment. It was a great way to meet and greet friends, allies and rivals in the business. It was exciting and fun and loud. It had its faults, but it acted as a focal point for the industry, before the summer's business of preparing for the Holidays really began.
It was an opportunity to take stock of the industry as a whole - the people, the products and the trends.
Many greeted the news that E3 had gone with shock. But, in reality, its days were numbered. Here's why...
1. The People Who Pay Weren't Happy
E3 was a great showpiece for the industry as a whole. But the industry as a whole does not pay for E3. Individual companies pay. They need to be able to demonstrate tangible benefits for that expense, just as they would for any other marketing cost. Those benefits were always difficult to justify, but had now become completely untenable. We understand some publishers still believe the show pays its way (for them individually). The trouble is, not enough companies took this view.
2. Four People Said 'Enough'
When I spoke to some people about E3's collapse, the general response was one of disbelief. How could something so big fall apart so quickly? Perhaps this is why so many news outlets simply refused to believe the news. The fact is that all it took were a very small number of company presidents to talk with each other, and figure out that if they all decided to pass, none of them would need to be there. Once Nintendo, Microsoft, SCEA and EA had stepped out, E3 was history. It was multilateral disarmament.
3. Media Irrelevance
There was a time when the game industry could enjoy its little May media window, as major news networks sent their reporters to the show to talk about the state of the industry. The fact that they usually filed stories on either videogame violence or new hardware launches that would have been reported anyway, seems to have been allowed to slide. These days, games are a major entertainment for people of most ages. News editors can't afford to just cover games during E3, or with a pre-Holidays buyers' guide. Games are always on the radar.
4. The 'E3 Winners' Farce
The 'who won E3?' contest beloved of we in the media had become a real problem. E3 is not a sporting contest, and yet it was increasingly seen as some form of championship. Every year we have one winner (2006: Nintendo; 2005: Sony etc.). Companies on this merry-go-round must sooner or later see that the value of winning one-in-three is not balanced by losing two in three.
5. Rise of Publisher Events
Media events held by companies to show off their own products offer publishers more control, lower costs and a more intimate atmosphere. They've been growing drastically in scale and importance. Without the burden of E3's expenses, this trend will continue, only more so. The downside of this is that, while larger companies can expect wide media coverage of their events. Smaller companies cannot make so much noise. The likely outcome will be more lavish events designed to attract jaded journalist. Or road-trips, in which companies make the effort to present their goods to the widest possible audience.
6. Common Sense
Then there's common sense. For example - Nintendo's aim at E3 was to get Wii into as many hands as possible. There must be better ways of doing this than spending $20 million making a bunch of developers and blog editors stand in a line for three hours.
7. The Internet
The Internet generally gets the blame for bringing old establishments to their knees, and this is no exception. Information is disseminated faster and at better resolution than ever. The need to go to Los Angeles to look at a game is somewhat negated when you can download a movie, or play a demo on Xbox Live. No, it's not the same, but it's close enough to make a difference.
8. The High Cost
Convention Centers the world over charge extortionate prices for mundane services and LACC is no exception. There is something extremely infuriating about being charged $20 for a sandwich, a soda and a packet of chips. E3 didn't die because of the price of sandwiches. But the fact that every single thing associated with the show cost a great deal of money was a contributing factor.
9. The Herculean Effort
E3 isn't just measured in terms of the cost of the booth, the floor-space, the party, the hotel, the flights etc. There's also the incredible amount of effort that goes into preparing for the show. Marketing teams are focused on E3 for a good six months of the year. Developers are whipped along as they try to get games ready for what is, essentially, an artificial deadline. It could be argued that this adds focus to development as projects near their conclusion, or it could be argued that it's an unnecessary diversion and a big pain in the ass. Publishers that focus on company-specific events are not under so much pressure to compete with the rest of the market for column inches, months before the real battle of competing for consumer dollars.
10. Big Shows are Passe
For all of the reasons above, massive pan-industry events are feeling the squeeze. In many industries, attendance figures are down, while companies seek to cut costs by camping outside these events, or by avoiding them altogether. Cities that hold these events are often criticized for ramping up hotel prices and gouging attendees. Ultimately, they are losing the cost / benefit analysis.
Whatever passes for E3 next May, Next-Gen will be there. It may be called E3. It may feature some people looking at games in a big room. There may even be some free drinks. But it ain't going to be E3.
A SAD DAY INDEED!
gamgator2000 out . . .
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