More Back Pages stories

Epilog - but wait! There’s more to the E3 controversy

CES wants to be E3

CEA forms advisory committee to explore gaming event options

The Consumer Electronics Association (CEA), the owner and producer of the International CES, which brands itself as “the world’s largest consumer technology tradeshow,” announced recently that it is forming an advisory committee to solicit gaming industry feedback and explore the viability of a West Coast event in late spring 2007 focused on the gaming and entertainment marketplace. Gee, what a coincidence! (See E3 story on page 29.)

Figure 1. Comdex and CES attendance history. (Source: JPR)

CEA brags that there are 2,700 member companies and exhibitors to CES and a majority are active in both the entertainment and gaming categories. And, claims CEA, more than 11% (17,800) of those who attended the 2006 international CES expressed specific interest in gaming and gaming products.

CEA says CES was the nation’s largest gaming show until E3 was formed in 1994. In addition, the Microsoft Xbox and Sony Playstation were both launched or previewed at CES, which as we know occurs in January, three months before E3 in May.

“Since ESA decided to eliminate the E3 event in its known format,” said Gary Shapiro, president and CEO of CEA, “we have been deluged with inquiries on whether we could fill the tradeshow needs of smaller video entertainment companies. Our executive board,” Shapiro added, “met and asked staff to explore ways that we can help the gaming community.”

Added Shapiro, “The Consumer Electronics Association believes that tradeshows are the most viable means for reaching a market as they serve smaller companies and entrepreneurs who need access to media, buyers, and investors. Our board, association, and events are committed to growing the industry—in fact, nearly 80% of our members are companies with annual sales of under $10 million.”

Said Karen Chupka, CEA’s senior vice president of events and conferences, “We will begin looking at venues in Las Vegas and Los Angeles and for appropriate partners. Should the committee recommend we move forward, we would design an event, which is consistent with CES quality. We already have commitments from three companies in this area to provide us advice on a new event in late spring 2007,” said Chupka. Companies interested in participating in the advisory committee should contact Karen Chupka at and Dan Cole at .

A brief history of Comdex—how not to run a railroad

The first Comdex was held in 1979 at the MGM Grand by Venetian casino and former Sands owner Sheldon Adelson and formed the Interface Group. In February 1995 Sheldon sold it to Softbank, who purchased the Interface Group for $800 million. At the time Softbank had already agreed to buy ZD Expo for $202 million from the Ziff family.

Ziff-Davis holdings were later split into three main entities: a magazine publishing unit that was sold to a private investment group; online unit ZDNet, which was purchased by News.com publisher CNET Networks; and Key3Media, which was spun off to Ziff-Davis shareholders as a public company.

In 1997, Comdex Fall in Las Vegas had profit margins in the 80% range, says Bill Sell, former manager of the show. It sold more than 1.35 million square feet of booth space at roughly $45 per square foot. Its sales force often extracted hefty downpayments 11 months in advance. According to Softbank, attendance at the 1997 Comdex hit 220,00 people and more than 2,500 companies exhibited at the show. In short, Comdex was a cash cow.

Every year Comdex staffers pressured vendors to buy bigger booths at higher prices: Take it or leave it. (IBM, famously, left it in 1997.) As Brian Caulfield of CNN Money said in 2003, “Comdex was a magnet for dumb money.” Seemingly every year some unknown company would buy a booth on the main floor of the show. The next year it would be gone—not just from the show but from the business.

In 2000, Ziff-Davis, still mostly owned by Softbank, spun off the shows (Key3Media) in a deal that would be financed with roughly $400 million in debt.

By 2000, Comdex was attracting some 200,000 visitors, although a number of big computer makers had already left the show floor.

Then attendance dipped to an estimated 125,000 people following the September 11, 2001, attacks.

In 2003 Key3Media and its Comdex holding was sold by Softbank to Triax Holdings for $1. Through a complicated bankruptcy proceeding, MediaLive acquired the rights to Comdex and tried to bring it back to life. Comdex limped on and was held in 2003

In 2004 MediaLive canceled the final Comdex show, to the relief of everyone.

In January 2006, CMP acquired Comdex as part of the MediaLive acquisition, which went for $65 million

And ever hopeful that the crowds can be lured back to the big tent, CMP Media, the now proud owners of Comdex, have launched a user survey and are trying to rationalize the expenditure they made for the dinosaur. If you need a laugh today go visit http://www.comdex.com/.

return to top