Missing Sony, E3 Moves Ahead Without One of Its Biggest Backers

Hanging E3 - Publicity - H 2019
Courtesy of ESA

For the second consecutive year, one of gaming's "big three" has opted to skip the annual event, leaving its competitors (and the industry) scratching their heads.

For the second consecutive year, one of the largest video game companies in the world, Sony, will skip one of the largest video game conventions in the world, E3. The surprise announcement came earlier this week and sent a ripple of questions through the industry, chief among them the most simple of all: Why?

Sony Interactive Entertainment declined to comment further beyond its initial statement that it has "great respect for the [Entertainment Software Association]," which organizes and presents the annual E3 convention in Los Angeles. SIE cited E3's "vision" as the determining factor for dropping out for a second year and also noted it would participate in "hundreds of consumer [separate] events across the globe" in 2020. 

Sony's absence is a major one for E3. Last year, a significant portion of the Los Angeles Convention Center's West Hall was vacant, usually dominated by Sony's sprawling booth. Meanwhile, competitors Nintendo and Microsoft are still scheduled to attend this year's upcoming event. The latter has a new, next-generation console slated to hit the market this holiday season, the Xbox Series X, which will directly compete with Sony's PlayStation 5, also due out this holiday.

"I’m quite surprised that Sony is bowing out for two years in a row," Lewis Ward, research director of gaming VR/AR at tech market research firm IDC, tells The Hollywood Reporter. "I thought for sure they were saving bullets by skipping E3 2019 in order to go big at E3 2020, but now it’s a pattern, and a head-scratcher given the importance of console gaming in the U.S. and the big bump Sony got from its 2013 E3 efforts relative to Microsoft’s stumble during the PS4 and Xbox One’s debut year."

The stumble Ward references is the troubled rollout of the Xbox One's initial announcements, which caused considerable backlash for its game licensing policy that linked titles to a user's Xbox Live account and required players to connect their console to the Internet in order to access their games. Microsoft addressed these concerns head-on at its 2013 E3 presentation, responding directly to fans' criticisms. 

The past six years have seen Sony separate itself significantly from Microsoft, with the PlayStation 4 selling more than 106 million consoles and 1.1 billion games worldwide since its initial launch. The Xbox One, meanwhile, has sold less than 50 million units since it debuted.

Ward posits that Sony's recent successes could have swayed the company's decision to skip E3. "It could just be hubris," he says. "PS2 crushed the competition and then Sony came out with PS3 at $600 and opened the door for Microsoft to surge forward with Xbox 360, and Sony may be back to feeling its oats and thinking PS5 is untouchable."

All three of the major game companies — Sony, Nintendo and Microsoft's Xbox — are members of the ESA. (Xbox head Phil Spencer and Nintendo of America president Doug Bowser both sit on the organization's board.) In the wake of Sony eschewing E3, both of its competitors have voiced support for the convention — without namedropping Sony.

“We look forward to participating in E3 2020. It is one of many ideal venues for us this year to interact with people in a social and immersive environment," Bowser tells THR in an emailed statement. "Every year, we base our approach to E3 on the content we have to share.”

The same day Sony announced it would skip E3, Spencer tweeted affirmation that Xbox would again be in attendance: "Our team is hard at work on E3, we look forward to sharing with all who love to play what's ahead for us." Microsoft declined further comment beyond Spencer's public statement.

As game companies continue to host their own direct-to-consumer live streams (such as Nintendo's Directs, Sony's State of Play events or even smaller, indie studios like Shovel Knight developer Yacht Club Games' August news video), the importance of throwing significant weight behind an E3-level showing is in question.

"I think the ESA puts E3 on to showcase the industry, and think that Sony’s membership in the ESA obligates it to participate," says gaming analyst Michael Pachter of Wedbush. "I understand that sometimes it’s difficult to justify a huge investment, but they should be on the show floor at a minimum, particularly in a year when they plan to launch a new console. I think they made a bad strategic decision and think it lessens the impact of E3 if Sony isn’t there."

It remains to be seen when and where Sony will unveil new details of its upcoming PlayStation 5 console. As E3 continues its more consumer-friendly approach (the event began selling general access tickets to the public in 2017), its status as an industry trade show may be waning. Coupled with a high-profile controversy last year (the ESA leaked personal information of thousands of attending media members) and Sony's repeat absence, the convention has lost a bit of steam in what seemed, at the onset, like a pivotal year for the event given the two new consoles on the horizon. 

"A series of local, smaller events may be a better match for [Sony's] PS5 launch strategy in 2020," says Ward. "I don’t know if E3’s general direction since 2017 has been a turnoff to Sony, but I’d give this rationale an outside chance of playing a role in their decision to skip E3 2020."