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E3 in 2013: Still a Game-Changer for Industry?

E3 in 2013: Still a Game-Changer for Industry?

Jun 11, 2013

E3: Exaggerate, Encourage, Engage?

“The report of my death was an exaggeration” Mark Twain responded upon reading his premature obituary in the New York Journal. It appears as though this year’s E3 wants to make the same statement. With the expo turning 18 this year, how has the event matured and how much does it still matter in the gaming community?

 

Exaggerate

Travelling by public transport to work, it’s hard not to spot at least half a dozen people playing Temple Run on their phones or Majong on their tablets. With the recent revolution in mobile gaming, are consoles and big developers with AAA titles beginning to be deemed old-fashioned? E3, long seen as the home of the big developer and console gamer has been similarly maligned.

At E3 this year, Nintendo have opted against a keynote (although they will have a booth) and popular developer 2K is not showing up at all, so are people losing confidence in the expo? Some evidently now believe that the cost of throwing a full super-bowl style launch is not worth the return. Companies have become savvier at connecting to their audience directly through social media and much like the trend towards downloads away from physical copies of games, developers have questioned the need for a physical presence.

The growth of blogs and online news sites means that those who are interested can always find out the latest news at any time, but to keep people interested, the media are also keen to sensationalise any news and squeeze it into a narrative. Both of these have damaged E3, as they have taken away some of its sheen as a venue for companies to release news and any news which can be portrayed negatively (even wrongly) will be spun as a death knell for the expo.

 

Encourage

Big video game titles are not dead: of the top 10 grossing video games ever (according to Digital Battle) 7 were released in the last six years and none were released earlier than 2000. Similarly the Wii, Xbox 360 and PS3 are the 5th, 7th and 8th best selling consoles of all time. The gaming industry is still growing and while the total market growth rate (Compound Annual Growth Rate in the high single digits) is slower than the astonishing numbers predicted for the mobile and tablet segments (CAGRs of 18.8% and 47.6% respectively according to Newzoo), this is still growth in a time when many markets are struggling and stagnating. By 2016 consoles are still predicted to make up almost a third of the market; it appears that the growth in other platforms for playing games will not come at the expense of the consoles.

 

Engage

Intangibility, amorphousness, nebulousness; these are the words that come to mind when trying to get a handle on the shape (or non-shape) of the gaming industry at the moment.

Until their second press conferences yesterday, Microsoft had a console and no games, and Sony had games and no console. The public are generally confused about the next generation of consoles and sentiment threatens to turn negative in the face of a steady drip of critical stories which have emerged recently. E3 provides a platform for the industry to engage with the public, but primarily, the media.

Other events in the calendar are now more closely watched by the hardcore gamers, but E3 gives an opportunity for the mainstream press to report positively on video games. This positive press cannot be undervalued since the default position of most media outlets is one of mistrust and outright hostility. The strongest evidence of all is how both giants used the press surrounding E3 to announce their missing parts – games in the case of Microsoft and the console for Sony.

Microsoft this year certainly needs E3 to shore up belief in its Xbox One console whose confusing and opaque system of licensing and online requirements has left many scratching their heads. A few choice titles from trusted franchises will do much to allay any fears that potential users have.

The answer is that there is not one state of the gaming industry; it is now so vast and broad that it can hold multiple equilibria all at the same time. If E3 this year does more to show off the presence of mobile, social and indie games then perhaps it could be considered a better representation of the industry.

Alternatively, as a place where the big names make the most noise, but the smaller companies innovating new business models generates more excitement overall, some might argue that it’s a very good representation of the industry indeed.

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