Connect with top gaming leaders in Los Angeles at GamesBeat Summit 2023 this May 22-23. Register here.
It was overdue and predictable. I’m not talking about Donald Trump’s indictment. I’m talking about the cancellation of E3 2023. That poor attempt at levity belies the fact that I’m crushed that we won’t have a show this year that in the past was a glorious celebration of all things gaming.
This made me nostalgic for my best memories of E3. I attended about 24 of them in my life. Last night, I grabbed dusty copies of my books, Opening the Xbox (2002), about Microsoft’s entry into the game console business, and The Xbox 360 Uncloaked, about its sequel machine in 2005. I started flipping through the pages and the memories came shooting back to me like images flipping in my mind.
I remember going to the Consumer Electronics Show in Las Vegas in 1994, the last year when the video game companies participated in the big tech show. The game companies were in a big tent in the parking lot, and they didn’t like that one bit. Sega’s Tom Kalinske griped that patrons had to walk past the porn vendors to get to the games area.
That year, the game companies formed the Interactive Digital Software Association (IDSA, which later became the Entertainment Software Association in 2003). A fiery lobbyist named Doug Lowenstein had to regularly defend the game industry from anti-violent-game crusader Jack Thompson.
GamesBeat Summit 2023
Join the GamesBeat community for our virtual day and on-demand content! You’ll hear from the brightest minds within the gaming industry to share their updates on the latest developments.
The game industry sprouted in the ghetto of the kids market, and it struggled to escape that. It got no respect. E3 was born in protest to a show that wouldn’t change with the times, and so the first Electronic Entertainment Expo took place in Los Angeles in 1995 at the sprawling Los Angeles Convention Center.
I made it to my first E3 in 1997. That year, the show took place in the muggy environment of Atlanta, and Intel CEO Andy Grove was the keynote speaker. Intel dancers came out in “bunny suits” — the head-to-toe cleanroom outfits used by chip workers — and then one of them took off a hood. And it was Andy Grove, who laughed after the dance routine.
A couple of years earlier, Grove had promised a “war for the eyeballs” coming at the Comdex computer trade show. At E3, he made a threat. He said that the game makers needed to realize that their business was changing, and the general-purpose PC was going to overwhelm the console business. Those console game makers didn’t want to suffer the same fate as the railroad companies, which realized too late that they were in the transportation business, not the railroad business, as they were overwhelmed by airlines.
Grove said we were at a strategic inflection point. “The video game industry is not in trouble at all; in fact, it is doing well,” Grove told the crowd. “But a bit like we were building microprocessors, even as our memory business was prospering, something is gradually sneaking up on the world. That something is personal computers and increasingly high-powered personal computers in the home.”
Grove turned out to be right that the PC would become a gaming powerhouse, but he was utterly wrong that consoles would fade to black. Rather, he failed to see the strength of the coming triumvirate of Sony, Nintendo and Microsoft (which replaced Sega) in the console business. It was a multiplatform world, and games, like the expansion of life noted in Jurassic Park, found a way. Games expanded to take over virtually any new platform, and now there are dozens of game platforms. I call that Blackley’s Law.
The video game people didn’t invite Grove back. The moguls of the industry — Kaz Hirai of Sony, Peter Main of Nintendo, and newcomer Robbie Bach of Microsoft — joined a panel at E3 2001, as Microsoft was bringing its Xbox to market. The veterans kind of ganged up on Robbie, who was visibly annoyed at being heckled by Hirai saying, “Follow our lead, follow our lead.” Larry Probst, the CEO of Electronic Arts, told me in an interview — after Jeff Brown told him to quit looking at his phone — that those guys hated each other. They never appeared on stage together at another E3.
Bach had an embarrassing moment going to press the “on” button for the Xbox at Microsoft’s E3 press conference. And the machine didn’t turn on. It was one fumble after another, but somehow, even after 9/11, Microsoft got its console out the door and sold out its machines, thanks to a little game called Halo. A couple of years before, I had seen Halo on the E3 show floor at Bungie’s booth, and that pulse-pounding music of Marty O’Donnell, and the Gregorian monk voices chanting a song — sung by O’Donnell himself and three actors who came from a Mr. Clean commercial — captivated me. It was little moments like that, when you knew you found something magical, that made me stick with E3.
Microsoft acquired Bungie, turned Halo into a massive hit, and Ed Fries had to mollify an angry Steve Jobs from Apple, which had previously had dibs on Bungie’s games. Yet despite Halo, Sony always had a way of getting the upper hand by showing off titles like Grand Theft Auto V.
The two shows in Atlanta were forgettable, but the Los Angeles Convention Center was a place of pure competition. In the West Hall, a narrow hallway separated the Xbox and the PlayStation booths. Nintendo specialized in creating magical experiences for attendees, who were all professionals on the outside and fanboys and fangirls on the inside.
In Kentia Hall, you could find the weird stuff, like mobile games, among the low-budget small booths. I was always astounded that there were hundreds of companies there, showing off around 2,000 games. But later on, this seemed like nothing, as modern app stores now have millions of games. In 2016, there was a great moment when Bethesda’s Todd Howard announced Fallout Shelter was available on iOS at that very moment during an E3 press event. And that day, people downloaded it 12 million times.
In those days, the one-upsmanship was hilarious. Sony threw gigantic parties with up to ten concert stages on a hill outside of Dodger Stadium. After a successful PS2 launch, Hirai declared, “The console wars are over!” Satoru Iwata told me in an interview that Sony’s announcement was so “arrogant.” And Iwata later got the last laugh by launching the amazingly successful Nintendo Wii in 2006. Envisioned as a low-cost device that appealed to people who didn’t know how to play games, the Wii was one of the devices that expanded the size of the game market. Hardcore gamers belittled it as childish.
Inside Nintendo’s antiseptic white offices at its booths, I would meet with Shigeru Miyamoto, Nintendo’s artisan game designer. I’d ask him questions and I could tell he understood my questions in English. But he would reply in Japanese, and Yasuhiro Minagawa would translate the answer back to me in English. Later on, I’d talk with Reggie Fils-Aime. I once asked him if he could tell me the hardest question I could ask him. He replied, “You want me to do your job for you?”
And who could ever forget Reggie’s intro in 2004 at E3, before a crowd of thousands. “My name is Reggie. I’m about kickin’ ass. I’m about taking names — and we’re about making games.” Those were the days when the rival leaders at the companies were swashbucklers.
The ESA always had infighting, and in 2007 it decided to blow up E3, which had gotten too expensive with its gigantic show booths, carnival extravaganzas, and plentiful booth babes. It shrank the show down to a few thousand people in 2007 so the expo fit inside the Santa Monica airport Barker hangar. The show focused on the media and retailers only, and it wasn’t fun anymore. Indie devs at Gamecock sent a parade of a New Orleans-style funeral band marching down Ocean Boulevard, mourning the death of E3.
The next year, the even smaller show in 2008 was at the cavernous Los Angeles Convention Center. I recall walking down the connector hallway between the South Hall and the West Hall. I was the only one in it, save Tom Russo, the G4 guy, who yelled at me, “Hey Dean! Can you see me!”
Slowly, the crowds returned to E3 until it once again became unbearable. I remember one year going to the show with Matthew Linley of VentureBeat and then I forgot where I parked my car. We had to walk up and down the underground lot until we finally found it.
In those years, mobile game companies like Gree started showing up at E3 with what hardcore gamers considered to be crappy games. But those crappy free-to-play games, running on iPhones and Android phones, made the game market so much more accessible with the low price of free. The size of the game market grew 10 times to several billion players worldwide. The hardcore gamers stuck with their devices, but they had to grudgingly accept the mainstream growth of their industry — and the fact that games weren’t just for nerds anymore. They were for everyone.
In 2016, Electronic Arts broke ranks and staged its own show ahead of E3 in Hollywood. It basically wanted to do its own show, but still benefit from the crowds coming to E3. I viewed this as a kind of tax evasion, and it was a preview of trouble ahead. The Oculus and Steam VR folks invaded the show, then they retreated, and then later on they made a comeback.
In 2017, E3 invited consumers into the show. I had to brave the consumer crowds to get into the South Hall and then make my way to my first appointment with David Haddad, head of Warner Bros. Interactive Entertainment. He showed up late because he got stuck in the crowds and he said, “What have we done?”
More than 15,000 fans crowded the show that year, and it made it hard for the business professionals to get their work done. As the fan numbers grew, more people complained that, at about 70,000 people, the show was getting too big again.
I loved the spectacle of E3 at its finest, like when Hideo Kojima showed off Death Stranding. When Jeff Grubb and I saw the befuddling trailer together at E3 2018 (the one that ends with Lea Seydoux eating some kind of grub worm), we just laughed out loud because we had no clue what we watched. Kojima seemed so insane, but he had been blessed as a genius in a kind of coronation at E3.
Microsoft, meanwhile, showed up with its Xbox Adaptive Controller, a device aimed at making games accessible to those with mobility problems. It was a product that brought tears to my eyes because it was really a product that did the right thing and opened doors to a new market.
In 2019, I remember the incredible cheer when Keanu Reeves came out on stage and made everyone crack up as he touted Cyberpunk 2077. That year was also probably the last of the booth babes, as the game industry became engulfed in the Me Too movement.
By 2020, some rifts were growing. Sony dropped out of the show, as did longtime video leader Geoff Keighley. Then the pandemic cut us all down to size. The E3 show was canceled. Everything shut down. But Keighley started the Summer Game Fest, a show that could capture announcements of new games.
While E3 was in flux, each December, Keighley’s The Game Awards showed astounding growth. Started as an online show in 2014 as a sequel to the Spike Video Game Awards, the all-digital show saw record growth into tens of millions of viewers.
The awards became gaming’s biggest night with a combo of awards for beloved games and exclusive previews of coming games. I felt like Keighley got a huge bump when award winner Josef Fares came out on stage and said, “Fuck the Oscars.” At another E3, Fares said, “When you play this game through, I guarantee you will never play anything like it before. I guarantee you. If you don’t like it, you can break my legs.”
In December 2020, The Game Awards skyrocketed to 83 million viewers, up from 45 million the year before. In 2021, the audience hit 85 million. E3, by comparison, had paltry numbers in 2021 and it was overshadowed by the growing Summer Game Fest, particularly when Keighley closed the show with an astounding demo of Elden Ring. In 2022, E3 was canceled altogether, while the Summer Game Fest added a physical venue for press demos.
It became evident that Keighley had become bigger than the ESA when it came to audience size. The Game Awards hit a record 103 million viewers (5,000 in person) in December 2022. And Keighley staged the death blow for this year’s E3 by scheduling the Summer Game Fest — with an intended in-person crowd of 5,000 — on June 8, just ahead of E3 starting on June 11 with press events. Dozens of big game companies decided to show their games in the Summer Game Fest, and that caved in the center of E3.
Each company made its own decision. Electronic Arts opted out early. Sony dropped in 2019 and never came back. Finally, this year Nintendo, Microsoft and ultimately Ubisoft dropped out. Collectively, they didn’t behave as one industry, and so the center could not hold. E3 became a victim of the tragedy of the commons, and that is why I am so sad to see it go.
I always thought it was irresponsible for the game giants to look out only for their own interests. I favor the action of a single community looking out for its own best interests, rather than a collection of individuals with only self-interest. But I guess you can’t fight capitalistic fear, or fate. I only hope that the game industry remembers that the thing that will save it in the long run is community.
Indeed, you can’t fight economic gravity or the wisdom of the crowd. Rest in peace, E3. Long live the Summer Game Fest and The Game Awards. While E3 is dead, games have never been bigger, and, with a newfound marriage with Hollywood with shows like The Last of Us on HBO, they’re poised to take over mainstream culture.
GamesBeat's creed when covering the game industry is "where passion meets business." What does this mean? We want to tell you how the news matters to you -- not just as a decision-maker at a game studio, but also as a fan of games. Whether you read our articles, listen to our podcasts, or watch our videos, GamesBeat will help you learn about the industry and enjoy engaging with it. Discover our Briefings.