The Electronic Entertainment Expo used to be a big deal. There was a time when it was the genesis of iconic video game announcements, moments that launched a thousand memes, and industry-shaking corporate maneuvers. Not so much these days. This year’s conference, which would have kicked off today — and which hasn’t convened physically since before the Covid-19 pandemic — was canceled in its entirety after console giants Microsoft, Sony, and Nintendo all pulled out. The Entertainment Software Association, which has hosted E3 since 1995, won’t say whether last year’s event was its curtain call. Either way, it’s obvious the biggest companies in gaming simply don’t need such a showcase anymore, preferring to participate in smaller events or simply roll out their products without a flashy, expensive, potentially awkward kickoff. The fate of E3 itself is less important than what it reveals about an industry at a crossroads, with cloud gaming, virtual reality, and new social platforms all pushing the medium toward the next step in its evolution. Video games have traditionally been the conduit that leads to mass adoption of what at first seems like hobbyist technology, from Doom and Solitaire with personal computers, to online gaming making it normal to interact and develop relationships with strangers on the other side of the globe. On one hand, the decision for Microsoft and Sony’s gaming arms to move away from high-profile console launches as the center of their business, for example, might make them seem like another cog in the big-tech machinery. But on the other, the recreation-first, trend-chasing, competitive ethos of the industry might proliferate through global tech writ large, meaning today’s fixations and gimmicks could shape the foundation of everything from a fully-3D future internet to to how future war machines operate. “When it comes to future technology there are two cases to consider,” said Mikhail Klimentov, an assistant editor at the Washington Post who once edited its now-defunct gaming vertical. “One is that as video game publishers and developers face economic headwinds, they'll have to lay people off… and the easy thing to cut is the stuff that’s not making money.” On the other hand, however, he argues that the culture within gaming studios is to keep around the strange old wizard in the laboratory, tinkering away on a project that’s nowhere near profitable but just might blow someone’s mind enough to turn it into a salable product. “The default work of game development ends up turning up gold for people who want to build something new, and who are trying to upgrade their technology,” he said. There are a few different speed bumps on that trajectory right now, including those economic headwinds that are still battering the tech industry. From 2020 until just recently this year, supply chain issues stymied the manufacturing and launch of gaming consoles like Sony’s Playstation 5, which are traditionally the engine of the entire industry. Platform-agnostic, social-first game experiences like Roblox and Fortnite, largely popular with children, rival the reach of the legacy console developers themselves. Microsoft is locked in a legal battle with the Federal Trade Commission over its attempt to acquire Activision Blizzard, one of the industry’s titans. That means that strictly from a policy standpoint, the way video games interact with society writ large is more relevant than ever, considering the largely bipartisan new attitude toward taking a stronger hand on regulating tech platforms. “You have the neo-Brandesian antitrust policy that’s in vogue at the FTC and the British Competition and Markets Authority, which is rubbing up against a trend towards consolidation,” said Will Duffield, an analyst at the Cato Institute. “And then you have children's safety concerns, which … often include gaming as an afterthought. It isn’t the 1990s PMRC, or an anti-Grand Theft Auto crusade, but concerns about children's use of social media that ended up regulating their use of games as well.” But there are also a few different ways in which gaming might continue pushing tech forward, and defining our basic relationship to it. Take, for example, virtual reality. Even VR’s biggest boosters agree that when it comes to developing fully immersive experiences that people actually want to come back to again and again, the same way they would with, for example, Nintendo’s latest Legend of Zelda release, the technology isn’t anywhere close to being ready, even at the deluxe $3,499 price point of Apple’s new product. “Anyone who is selling the idea of the metaverse right now is trying to sell you a bill of goods,” Klimentov said. Still, that’s not always going to be the case for a generation that’s used to spending the majority of their social downtime on platforms like Roblox. Whether they’re interacting with them through the lens of a VR headset — something Klimentov expressed skepticism about — he said “At some point, those kinds of spaces are going to feel very normal to people.” So if the console business is hampered, VR isn’t ready, and game development is at risk of rolling up further and further into monopoly, where does gaming have the potential to actually push things forward? Klimentov first cited the defense industry, pointing to the Department of Defense’s use of sophisticated gaming technology and Israeli tanks that use real, honest to God Xbox controllers. Duffield, however, made an affirmative case for augmented reality. He made the more philosophical point that developers will naturally gravitate toward the most cutting-edge platforms, and especially one with Apple’s reach and monetization — a dynamic that will, inevitably, bring consumers that rarest of experiences right now in a VR experience they want to return to again and again. “I see that as quite significant, and really, as the future of mobile gaming, because like your phone it can be something that you’re out in the world with,” he said.
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