E3 Cancelled for 2007 and Beyond?

Trouble is brewing at the Electronic Entertainment Expo (E3) headquarters. Inside sources from the Entertainment Software Association (ESA) revealed to MCV that E3 as we know it has been cancelled for the next year and the foreseeable future. There are plans to scale down the size of the event is an attempt to salvage what's left, yet we won't see another massive expo anytime soon. As a fact, the Los Angeles Covention Center does not have E3 on the schedule for May 2007.

Since the mid 90's, E3 has been the single largest event in the gaming industry, highly awaited by professionals and fans alike. In the beginning, the feeble gaming scene required this kind of massive coverage to draw attention upon its products, yet 2006 showed reality to be different. Over the years, companies steadily increased their budgets for E3 presentations to a point where things got out of control. Within the halls of the Los Angeles Convention Center, major publishers saw limited impact on the public compared to the money spent for promotion. This is a serious blow to Sony and EA and considering the costs involved, it becomes apparent that things need to change. ESA sources confirmed that larger exhibitors plan on withdrawing their support, placing E3 in a difficult position.

"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." Since executives seem to debate about the problem, ESA president Doug Lowenstein is likely to announce the news within the next day.

However, scaling down the event might not be so bad for the industry. It would provide more focus on indie labels as attendants would range into selected hundreds, as opposed to this year's 60000. A temporary solution that can improve cost effectiveness for the main brands was presented at E3 and could prove to be the winning compromise. Still, the damage is done and the good days of E3 where all the major publishers were showing off and spending big money are gone.