E3, the video game industry's largest annual trade show, opened Monday in Los Angeles — but it may relocate in 2013 if issues around the construction of the proposed Farmers Field and rebuilt convention center are not resolved "imminently," said Michael Gallagher, president of the Entertainment Software Assn.
The convention draws more than 45,000 attendees from around the world who fill an estimated 30,000 hotel rooms. It is among the city's most lucrative conferences, generating approximately $40 million in direct spending on such things as lodging, restaurants and taxis, as well as temporary construction workers and hundreds of booth attendants during the four-day show, according to the Los Angeles Convention and Visitors Bureau.
The Entertainment Software Assn. last year put the city on notice when it balked at renewing its contract to stage E3 at the Los Angeles Convention Center beyond 2012, citing uncertainties around the proposed remodel of the convention center to make way for Farmers Field.
This year the tone seems more urgent.
"We're still in discussions with the city of Los Angeles," Gallagher said in an interview Sunday night, "but we have a number of issues that still need to be resolved. If we can't resolve them, we are preparing to go elsewhere."
He did not identify which cities his group has been negotiating with, though executives close to the association who requested anonymity because negotiations are confidential said San Francisco, New York, Chicago and New Orleans have been among the candidates. E3 has taken place in Los Angeles for 16 of its 18 years in existence.
Among the group's concerns are ease of access to the convention center during any construction and guaranteed access to adequate show floor space.
"We need assurances on things like square footage, the quality of the space, the ease of loading and unloading equipment, signage throughout the convention center for marketing and sponsorships," Gallagher said. "We love being in Los Angeles, but we also have a show to put on."
In other E3 news, Microsoft Corp.announced a slew of entertainment partnerships — with Nickelodeon, ESPN, the National Basketball Assn. and Univision, among others — as it seeks to turn its Xbox 360 video game console into an all-purpose media device.
"Xbox has historically stood for gaming for hard-core gamers," said Yusuf Mehdi, chief marketing officer for Microsoft's interactive entertainment division. "Now it stands for entertainment for a broad audience."
Microsoft trotted out several celebrities for the presentation, among them former gridiron great Joe Montana demonstrating the upcoming "Madden NFL" football game; "South Park" creators Trey Parker and Matt Stone showing off a new game based on their famed Comedy Central cartoon; and Usher, who performed on stage to help promote the dancing game "Dance Central 3."
On the games front, Electronic Arts on Monday said it would open significant portions of its massively ambitious game "Star Wars: The Old Republic" to players for free starting in July, in an attempt to find more subscribers willing to spend a monthly fee to play the online title.
The game, which cost more than $150 million to create, was among the costliest of all time. Monday's news is an admission that to attract new players amid stiff online competition, much of it in the form of free games, "The Old Republic" had no choice but to offer an introductory experience at no cost.
Also on Monday, Agoura Hills-based THQ said it ended an agreement to publish games based on the UFC license, a big blow for the struggling game publisher that was once the undisputed master of mixed martial arts video games.
At the same time that THQ made its announcement via news release, UFC President Dana White strode onto a stage at Electronic Arts' news conference at E3 in Los Angeles to announce a multiyear agreement with EA to make mixed martial arts games.