Taking a moment to reflect on more important things in life, namely video games, I turn this site’s attention to the soon-to-start Electronic Entertainment Expo 2007: Media and Business Summit, popularly referred to as E3) which is about to begin later tonight in L.A. While 2007’s event probably won’t prove as dramatic as 2006’s high-tension roller coaster ride (the phrases “599 U.S. dollars” and “Riiiiiiiiiiiidge Racer!!!!!!!” is still widely recognized among gamers), it is already proving pretty interesting despite the fact that the event has yet to begin. Here’s what to look forward to over the rest of the week, as well as my predictions for the coming year in gaming:

The New E3

Shortly after E3 2006 had concluded, the body which represents game manufactures announced that they were pulling out of the annual May event, sending ripples throughout the industry. At that time, E3 was the largest trade show for video games, but it was also proving too expensive to put on for most game companies who saw little value in return. As a result, this year’s show is being held in July, two months later than usual and in a new, smaller venue with a stricter and smaller guest list. The show won’t have playable demos so much as news conferences and videos. While many are predicting that this could kill E3 all together after this year, I think the evidence is already pouring in that this might be an even better format for the show, given how much it makes game execs eager to attract attention to their company through outrageous and blunt statements…

Look at Us, Look at Us!!!

As I’ve inferred already, game company reps have had pretty loose lips on a whole variety of video game related issues so far, in the lead up to the show. The best so far came from Electronic Arts’ CEO who said that the industry was both “boring people” and creating a “rinse and repeat” culture. The statement was both powerful, but also ripe with irony. Powerful for how directly critical these words were, but ironic since Electronic Arts (EA) is the most notorious of its peers for making unimpressive and boring games and then coming back the following year to produce pretty much the same product. I personally own 200 games; none of them are from EA, despite the company being the largest North American publisher 13 years running. At least they realize there’s a problem though…

While we’re at it though, Konomi’s US/Europe head today all but confirmed that Metal Gear Solid 4: Guns of the Patriots would be going multi-platform, most likely to the xbox 360. This is crushing for Sony, for whom MGS4 was the last surefire blockbuster exclusive that they could count on to push consoles. Square-Enix’s French head earlier this year suggested that the other big PS3 exclusive at this time last year, Final Fantasy XIII, would also see the light of day on “other systems”.

It’s nice to see a little more honesty and brashness coming from third party developers this year, in contrast to previous years where they catered to their favourite console companies. While this might cause a bit of discomfort in the game industry, which is more jealous and envious than a high school prom after party avec alcohol, it will at least prove highly entertaining for at least the next year.

And then there’s that console war…

…which no one seems to have noticed has been going on non-stop since 1990! Anyway, in its current console incarnation, Microsoft’s xbox 360 leads the market with just over a 10 million unit installation base. Nintendo’s Wii is catching up quickly though at is has pushed 8.9 million units in just just under half the time. Sony, the former market leader before 2005-6, is now in third with its PS3 selling only 3.66 million units (stats courtesy of vgcharz.com) It is now a given in the industry that the Wii will overtake the xbox 360 by the end of August as the market leader due to its phenomenal success with both moderately hardcore and casual gamers. I actually predicted something along these lines during last E3 although I have to admit that I didn’t expect to see Microsoft survive so gracefully, nor Sony to do so poorly (this is correlated since I saw the PS3 replacing the 360 as the hardcore gamer’s system of choice). Given how desperate and disoriented Sony now appears to be, as well as it’s reluctance to attract or appease video gamers, I predict that by E3 2008 (and there will be one!), Sony will be surviving, but just barely. Its PS3’s future will also be in question.

Why do I predict this, given that this industry has only ever rejected two major consoles outright (Sega’s Saturn and Dreamcast, respectfully)? Well, the seeds were already planted last year, and now they’re coming to fruition this year. Last year, Sony’s arrogance was on full display as they were giddily predicting how many more PS3s they’d sell over the bestselling (although horribly engineered) PS2. They also had their major exclusives in Metal Gear Solid 4, Final Fantasy XIII and Rockstar’s Grand Theft Auto IV, so they weren’t too concerned with smaller developers who were frustrated with how difficult it was to program for the PS3. They also snubbed gamers with a $600 USD price tag for a console whose functionality was only superior to that of a home PC’s in that it could play BlueRay movies; this in itself was questionable given that Blue Ray is not yet an accepted mass-market medium. Most importantly though, Sony revealed just how little it cared for its game’s division when it openly admitted that it was shoving a great deal of unwanted and expensive technology on gamers just so that it could save its movie division (Columbia Tri-Star) and reap the rewards of royalties that it would collect through BlueRay licensing.

First gamers returned the favour to Sony by snubbing the PS3; reports came from Best Buy stores in the US where employees were using PS3 boxes to build forts since the supply so outweighed the demand. Next investors did as Sony’s stock was hit hard in March when it announced its annual profits were lower than expected. Now at E3 2007 we’re seeing the funeral for Sony’s life as console king in the form of developers jumping ship. Grand Theft Auto IV was already stripped of its PS3 exclusivity in any form earlier this year, Square Enix began to demonstrate its dissatisfaction over the past two months in particular and now Konami is openly rebelling. At the end of the day, if the PS3 can’t deliver any must-have exclusive hits, people will opt for cheaper consoles that Sony’s competitors offer where they can get pretty much the same game experience. Sony is just starting to see this, but even the $100 price drop that Sony confirmed on this weekend past is still attached to the arrogance that got Sony into this mess to begin with. Speaking to Gamespot, Sony’s CEO spoke of how much “value” a $500 unit had given that it was still worth its $600 tag that the console had a week prior, or the $800 hit that Europeans are taking for the same console (in fact, the gent also snubbed traditionally friendly European gamers by effectively telling them to shut up and buy more units before they’re allowed a similar token discount). The $100 price drop was effectively a message that read “Suck it up, you ungrateful little urchins!” since the PS3 was already priced at $500, if you consider the core PS3 unit that was put on market last November.

It’ll be interesting to see how Sony wiggles out of this one. To give the company due credit though, they’re very good at buying off companies and using that tactic to their advantage. They still might escape this plight they got themselves into, although I seriously doubt it, if they manage to buy an exclusive best seller for their behemoth console. In the mean time, every week Sony continues to shoot itself in the foot, Nintendo and Microsoft look much more confident and competent. I’m sure the royalties they’re collecting are nice too!