UPDATE BELOW. It's a runaway rumor with a kernel of truth. The ESA's supposed to clear it up later Monday.
Earlier: This is either a stunning game-world scoop or a future Snopes entry: Word is that some major game publishers have decided to abandon the massive E3 gaming convention in L.A. next spring because it's not worth their expense.
I'm not buying it. The industry's floundering for a foothold, to be sure, but too many millions are at stake to walk away from the single hugest chunk of marketing they could ask for. Besides, the clicktrail leads back to an ill-sourced story that - on the face of it - sounds iffy at best:
blogging.la points out that Joystiq said that Next-Gen claims that sources say that Entertainment Software Association president Doug Lowenstein is about to announce that some bigger gamemakers have decided E3 is not giving them strong enough return on investment.
Without the tentpole exhibitors, smaller gamemakers would drop out, too, NextGen speculates, in favor of more company-focused efforts.
The NextGen report has unnamed people saying the show might continue in some form. But if their report is accurate, it's a safe assumption that the next E3 will be nothing like the ones we covered in 2006, 2005 and 2004.
The story's all over the gaming blogs but they all point back to the lone NextGen post - which has only the thinnest of reports in place.
Here it is, in toto:
The Entertainment Software Association (ESA) shindig has been a staple of game industry life since the mid-1990s. However, we understand the larger exhibitors have jointly decided that the costs of the event do not justify the returns, generally measured in media exposure.
Publishers believe the multi-million dollar budgets would be better spent on more company-focused events that bring attention to their own product lines rather than the industry as a whole.
Well placed sources say the news that larger exhibitors were pulling out had prompted urgent meetings among publishing executives. They decided that, without the support of the larger software publishers and hardware manufacturers, there would be no point in continuing.
ESA president Doug Lowenstein will likely announce the news some time within the next 48 hours, possibly on Monday. It's likely that the ESA will seek to limit the damage by organizing some form of lesser event in May, possibly even with the E3 brand, but this will be no more than a fig-leaf. The days of an industry event attended by all the major publishers, spending big money, are gone.
Calls to ESA staff are not being returned at present.
Here's another scenario: Perhaps a single company - seeking leverage with ESA for next year's show - made some sort of idle threat that turned into a leak. And that leak now resembles the little trail of gunpowder that Yosemite Sam always winds up dropping behind him all the way back to the ammo dump, which proceeds to explode with an earth-shattering KABOOM.
Turns out people may be talking about scaling back from admitting the public, but not declaring E3's outright cancellation, a rumor that is now rampaging around the web like Master Chief on a bender.
A little more Googling turned up this MCV article from Friday afternoon, which may have triggered Next-Gen's rumor run.
MCV - the British gaming industry's equivalent of Variety - has sources reporting that
[S]erious discussions are taking place about the future shape and associated costs of E3.
Despite the Los Angeles event's undoubted importance and pulling power, some leading companies - and particularly Electronic Arts - have called for a review of the event in terms of budgets required.
As belts have been tightened through transition, so exhibitors are rightly questioning every element of their trade show expense.
MCV understands that a meeting has been held between ESA president Doug Lowenstein and major exhibitors in the US to discuss next year.
"Costs have been getting out of hand. We're talking double digit millions for some of us," said one senior industry insider. "But that's not just floorspace, of course - it's build, parties, hotels, flights. Security, particularly, has become a massive cost."
Most agree that E3 is an excellent event and not in any danger, but in current market conditions it would appear that everything has to be challenged.
Not. In. Any. Danger. Let's all calm down a bit.
Posted by: Mack_Reed on Monday, July 31, 2006 - 02:37 AM
