E3 Going Remote Will Cost LA’s Economy Tens of Millions—Again

Samson Amore

Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College and previously covered technology and entertainment for TheWrap and reported on the SoCal startup scene for the Los Angeles Business Journal. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.

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The Entertainment Software Association’s decision to hold its annual E3 mega-convention as an online-only event this year is yet another blow to Los Angeles’ struggling local tourism and events economy.

The world’s largest gaming expo has traditionally been a blowout summer ritual in the heart of Downtown L.A., drawing tens of thousands of visitors annually to the Los Angeles Convention Center and its surrounding attractions. In 2019, the ESA reported that roughly 66,000 people attended its three-day event that June.


After the coronavirus pandemic forced organizers to cancel the 2020 expo, E3 went fully remote for the first time last year as a free, virtual event broadcast online. But while there was hope that the convention would return as an in-person affair this summer, the ESA announced last week that “ongoing health risks surrounding COVID-19” mean that the event will be held online again this year.

It is yet another setback for a local tourism economy that has only begun to recover from the pandemic’s devastating impact. In 2019, E3 generated $83.4 million for the city’s economy, according to the Los Angeles City Tourism Department, with overnight attendees purchasing more than 29,000 hotel room nights to accommodate their stays in L.A. Besides die-hard gaming fans from around the world, the expo also attracts executives from across the video game industry—including those from prominent overseas firms like Sony and Nintendo who travel with corporate expense accounts in hand.

Doane Liu, executive director of the Los Angeles City Tourism Department, told dot.LA that local restaurants, bars and other retail businesses will lose tens of millions of dollars in revenue once more his year as a result of E3 going remote.

“We can only charge so much [at the convention center] for rent and parking and a hot dog at lunch,” Liu said of the city’s E3-related economic activity. “Where the real money is spent is when those business travelers are booked for nights at the J.W. Marriott, and go out to several dinners on their companies’ expense accounts.”

Liu noted that hotel occupancy in L.A. has yet to fully recover from the pandemic, which has hindered the amount of hotel tax revenue that the city can collect from hospitality operators. Average occupancy plummeted from 80% in 2019 to 49% in 2020, according to hospitality consulting firm HVS, with the city’s hotels currently hovering around 70% capacity, Liu said.

“That's one metric that's near and dear to our heart, because we collect bed tax and that helps pay for some of the city's budget,” Liu explained. “We practically give away the convention center if [organizers] agree to book a certain number of hotel rooms... It's really an incentive to bring business travel to Los Angeles.”

Like any event, E3 also generates sales tax income for the city as well—mostly from local shops and eateries in the L.A. Live entertainment complex and other Downtown businesses near the convention center. Estimated local taxes generated from the last in-person E3 in 2019 totaled $3.5 million, according to the City Tourism Department.

But it’s not just E3’s cancellation that concerns Liu and other city officials. Amid the ongoing spread of the omicron variant, there is fear that more major events—such as the Anime Expo in July and L.A. Comic Con in the fall—could potentially be impacted this year. “We’ve canceled over 300 events because of coronavirus,” Liu noted. But he added that roughly 80% of those events were able to be re-booked, and said the city is having no issues finding interested replacements for the ESA’s vacant three-day slot this summer.

E3 is passing on an in-person convention despite 2021 being the gaming industry’s biggest year on record, as the pandemic spurred more consumers than ever to pick up controllers and entertain themselves at home. U.S. consumer spending on video gaming totaled $13.3 billion in third quarter of 2021, according to market research firm NPD Group—up 7% from the previous year and the highest third-quarter spend in history. Video game developers, in turn, saw profits hit record highs; the big winners included Playstation maker Sony, which doubled its profits to a record $11 billion in its last fiscal year.

Liu said it is “ironic that the pandemic created the conditions for probably the most successful year in gaming sales,” and held out hope that E3 organizers will look to share some of that economic growth by returning to Downtown L.A.

“We're very hopeful that the success that ESA members have been having over the last couple of years will translate to getting them back here, as soon as we can have them here safely,” he added.

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Genies Wants To Help Creators Build ‘Avatar Ecosystems’

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

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Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

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Jamie Williams
­Jamie Williams is the host of the “PCH Driven” podcast, a show about Southern California entrepreneurs, innovators and its driven leaders on their road to success. The series celebrates and reveals the wonders of the human spirit and explores the motivations behind what drives us.
Jason Wise holding wine glass
Image courtesy of Jason Wise

Jason Wise may still consider himself a little kid, but the 33-year-old filmmaker is building an IMDB page that rivals colleagues twice his age.

As the director behind SOMM, SOMM2, SOMM3, and the upcoming SOMM4, Wise has made a career producing award-winning documentary films that peer deep into the wine industry in Southern California and around the world.

On this episode of the PCH Driven podcast, he talks about life growing up in Cleveland as a horrible student, filmmaking, Los Angeles and his latest entrepreneurial endeavor: A streaming service called SOMMTV that features–what else?–documentaries about wine.

The conversation covers some serious ground, but the themes of wine and film work to anchor the discussion, and Wise dispenses bits of sage filmmaking advice.

“With a documentary you can just start filming right now,” he says. “That’s how SOMM came about. I got tossed into that world during the frustration of trying to make a different film, and I just started filming it, because no one could stop me because I was paying for it myself. That’s the thing with docs,” or “The good thing about SOMM is that you can explain it in one sentence: ‘The hardest test in the world is about wine, and you’ve never heard about it.’”

…Or at least maybe you hadn’t before he made his first film. Now with three SOMM documentaries under his belt, Wise is nearing completion of “SOMM4: Cup of Salvation,” which examines the history of wine’s relationship with religion. Wise says it’s “a wild film,” that spans multiple countries, the Vatican and even an active warzone. As he puts it, the idea is to show that “wine is about every subject,” rather than “every subject is about wine.”

For Wise, the transition to launching his own streaming service came out of his frustration with existing platforms holding too much power over the value of the content he produces.

“Do we want Netflix to tell us what our projects are worth or do we want the audience to do that?” he asks.

But unlike giants in the space, SOMMTV has adopted a gradual approach of just adding small bits of content as they develop. Without the need to license 500 or 1,000 hours of programming, Wise has been able to basically bootstrap SOMMTV and provide short form content and other more experimental offerings that typically get passed over by the Hulus and Disneys of the world.

So far, he says, the experiment is working, and now Wise is looking to raise some serious capital to keep up with the voracious appetites of his subscribers.

“Send those VCs my way,” Wise jokes.

Subscribe to PCH Driven on Apple, Stitcher, Spotify, iHeart, Google or wherever you get your podcasts.

dot.LA reporter David Shultz contributed to this report.

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