A Look at the Biggest Trade Show in Gaming

E3

The Electronic Entertainment Expo (E3) is a long-running trade event for the computer and video game industry, one that has become perhaps the most notable of its kind. The event began in 1995 as a response to the burgeoning growth of the gaming industry and was started by the Entertainment Software Association (ESA), a trade association established to oversee the gaming industry in the wake of controversies surrounding violent and mature content in video games.
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In a darkened theatre in 2013, a man stood on a panoramic stage before hundreds of onlookers, the screen behind him read ‘Only On PlayStation.’ The man was Jack Tretton, former president and chief executive officer of Sony Computer Entertainment America. He was speaking about how Sony is committed to bringing its customers new video game titles and what they want without restriction or invalidation.

“For instance,” he said, “PlayStation 4 won’t impose any new restrictions on used games,” a sentence that was met with nearly thirty seconds of raucous applause from the crowd. Only days earlier, Microsoft – one of Sony’s direct competitors in the video game market– announced that it would be imposing restrictions on the reselling and lending of disc-based video games, a move met with ire from consumers.

Back onstage, Tretton continued. “When a gamer buys a PlayStation 4 disc, they have the rights to use that copy of the game: They can trade in the game at retail, sell it to another person, lend it to a friend, or keep it forever.” This was met with further applause and chants of “Sony!” With this declaration, Sony claimed not only a significant edge over one of its largest competitors but also secured one of the most unforgettable moments in the history of the Electronic Entertainment Expo.

For over twenty years, the multi-day conference has played host to companies, retailers, and vendors that want to present new gaming technology and products. Legions of industry executives, journalists, and fans also attend.

E3’s current reputation is as both a trade show for video game companies and as a barometer of the social and market prestige of companies within the primary consumer base. As evidenced by Sony’s landmark undercutting of Microsoft at the 2013 conference, a well-placed announcement or counter to a competitor’s presentation or practice can elevate a company to a winning status in the minds of millions of consumers worldwide, setting the tone for its financial and cultural future.

The gaming market has been growing to unprecedented heights. Gamesindustry.biz reported in December that the global games market value rose to $134.9 billion in 2018, based on figures provided by market analytics company Newzoo.

Whether through the rising market of mobile, smartphone, and tablet games, or PC or console gaming, the industry continues to cement its place as a top-earner. It commands attention on an immense scale, as trendy games like Fortnite claim over 200 million registered users, and popular video game streaming platforms like Twitch see hundreds of thousands of concurrent viewers for popular streamers like Ninja or BCC Trolling.

In its annual ‘Essential Facts’ report on sales, demographic, and usage data in the gaming industry for 2018, the ESA reported that 64% of American households own a device used for playing video games, and 60% play video games daily. The report also said that the total consumer spending on the industry was at $36 billion as of 2017. Financially speaking, video games have never been hotter, and gatherings like E3 act as a nexus for this growing sector.

Since its first conference over twenty years ago, E3 has taken on a different shape every year. This year’s conference will see a dramatic change to the schedule in the absence of one of the regular guests: Sony. Sony Chief Executive Officer Shawn Layden said in an interview with CNET earlier this year that the company will not be at E3 2019 – a first in conference history – because June is not an ideal time to be discussing upcoming releases. The holiday season accounts for many sales, and plans need to be made far earlier in the year.

So Sony has introduced new events this year – such as Destination PlayStation and State of Play – that have allowed it to present its upcoming releases to retailers and partners for the year ahead much sooner and on its own terms. Layden also says that the role of E3 as a trade show has changed dramatically especially with respect to the rise of the internet as a means for spreading industry news, and E3 as a place to make big announcements has lost a lot of impact as a result.

Similarly, video game company Electronic Arts (EA) announced this year that its approach to an E3 presence will change significantly as well, as it will forego its usual press conference approach in favour of multiple live streams featuring new gameplay and chats with developers and company personnel, in a bid to bring its audience “more of what you’ve told us you want,” according to the company.

The moves by both companies were a surprise to some, but are also not unprecedented. In June 2013, major company Nintendo withdrew from a typical conference-style appearance at the event. Instead, it will be hosting ‘Nintendo Direct,’ a video announcement with filmed and edited presentations of the company’s upcoming hardware and software launches.

One factor that may make companies like these balk at a continued E3 presence is that as much as a press conference can improve its stock among its consumers, it has an equal amount of power to detract from its reputation as well depending on the public reaction to an ill-timed or inadvisable announcement or a particularly embarrassing gaffe from an onstage presenter. References to ‘Mr. Caffeine’ – Ubisoft’s unfunny 2011 pitchman – or ‘$599 US dollars’ – Sony’s shocking announced PS3 price – live in infamy for such a reason.

As companies begin to change or even dial back involvement in E3, ESA was quick to reaffirm that many companies are still on board for the full conference experience. “Through the continued creative innovations delivered by our participating member companies, E3 2019 will deliver the same kind of excitement and energy,” said Stanley Pierre-Louis, ESA’s interim chief executive officer in an ESA press release.

This year’s E3 conference will take place from June 11 to 13 and will be the last show held at the Los Angeles Convention Center under the show’s current contract, which began in 2008. Nintendo will still be a key presenter at the event, and press conferences from companies like Microsoft, Bethesda, and Ubisoft are still expected as of press time. Last year, the ESA reported that over 69,200 people attended the conference, while online viewership of the conferences and various live-streamed events last year numbered into the millions.

The Electronic Entertainment Expo will be seeing some restructuring and change this year, but if these numbers are any indication, it seems that E3 will remain a hot topic of the gaming industry and a place for its greatest successes and shortcomings to play out for a worldwide audience.

July 24, 2019, 3:10 AM EDT