This went into the wrong thread. Wrong meaning it petered out quickly compared to this thread.
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This isn't a game industry issue. It's a trade show industry issue.
This stuff is way expensive. I know the guy whose company designed and built the Nokia N*gage booth for the 2004 E3. That sucker cost approx. $2.5 million dollars. Just the booth, not the space it occupied. A reusable version would be more expensive and would also have to be stored and shipped to events, which are not that frequent. Factor in all of the costs of E3 and Nokia easily sunk over $5 million into that year, and for what?
And Nokia's was far from the most expensive booth. They may have been in the top 15 but towards the bottom of that list. Sony, Microsoft, and Nintendo could easily have spent over $10 million each, including their press conferences.
For a vastly lesser amount of cash they can stage their own event near their HQ. All the personnel get to sleep in their own beds at home. The press and other attendees are solely those chosen by them rather than by the E3 gatekeepers. A big company can do it on their campus and dazzle without much elaborate building. A smaller company can make do with a hotel ballroom.
It's so much less expensive yet so effective it makes the shows from the old days like Comdex laughable. Comdex and shows like it long outlived their original purpose. Comdex stood for Computer Dealer Expo. It was a place to see a bunch of different products and place orders back in the day when there were a zillion independent computer stores that weren't building their own machines. By the early 90s the bulk of brand name computer sales were occurring by phone or through a short list of national retail chains. If the buyers for a dozen chains account for 70% of your business, it's far better to bring them to you, singly or in a group, and just sell tot he guys who matter.
It is little different for video games, especially in the era of the web and broadband. Once you've dealt personally with Best Buy, Wal-mart, Target, Circuit City, TRU, and a few others, everybody who is left doesn't amount to much. You can spend ten million impressing Mom & Pop store owners from Podunk or spend just a million showing that critical handful of big chain buyers a good time.
Events for the press mean a larger crowd but the math still applies. You can reach most of the guys who matter for a fraction of the cost.