For the second year in a row, PlayStation is skipping E3. The announcement might have come as a shock to some, given that 2020 is the year of the PlayStation 5. But Sony has good reason to abandon E3 again this year--the show just doesn't make sense for PlayStation right now. The company is, by all signs, better suited to break from the pack and hold its own events. By bypassing E3 this year, Sony does not have to share the limelight with Microsoft, and that works out well for both companies during this all-important year.

There are numerous elements at play here. We've analysed the key news and announcements to (try to) make sense of it all.

Why Is Sony Bowing Out?

A Sony spokesperson confirmed that the company conducted a "thorough evaluation" and ultimately decided to skip the show because it didn't align with its own ambitions.

"After thorough evaluation SIE has decided not to participate in E3 2020," Sony said. "We have great respect for the ESA as an organization, but we do not feel the vision of E3 2020 is the right venue for what we are focused on this year."

Sony won't be at E3 this year, but the company said it plans to take part in "hundreds" of consumer events across the world to promote PS4 and PS5 games. The full details of this plan remain to be seen, but you can expect more details to populate in due course.

It Makes Sense

Sony removing itself from E3 again this year might seem shocking at first glance, given the company's overall history with E3, but it's not all that surprising of a decision. The show's profile and popularity is generally understood to be diminishing. E3 remains a major event on the calendar, but for a heavy-hitter like Sony, the event is becoming increasingly irrelevant--and the decision to abandon the show for two years in a row is clear evidence of that. The appeal for E3, at least during a time, was that it provided huge mainstream media attention. That may still be true for some companies and developers, but Sony does not necessarily need to be at E3.

Like Nintendo, Sony is in the enviable position of being able to generate a huge amount of attention from mainstream media and fans alike from holding their own event.

People had an easier time understanding Sony's absence from E3 2019 because that year, the company had relatively fewer high-profile games coming out, and it was also too soon to start talking about the PlayStation 5 in an official capacity.

Some have commented that Sony's absence from E3 this year is especially curious given 2020 is the year of the PlayStation 5 and The Last of Us: Part II. But Sony can generate as much or more attention by conducting its own briefing, on its own terms, whenever it wants.

Separating from the pack gives Sony the opportunity to cut through the noise and blast its signal loudly and to more people than it might have otherwise were it confined to E3. Not only that, but floor space at E3 is not cheap, so this move saves Sony some scratch during a year where budgets are likely tight already with the ramp-up to release for the PlayStation 5.

For the PlayStation 4 reveal in February 2013, Sony rented out the ritzy Hammerstein Ballroom in New York City for a multi-day event that led to international news attention for weeks. While not confirmed, you can expect Sony to do something similar for the PlayStation 5 reveal--creating an event that's dedicated to the system and what's coming next for the PlayStation brand. The PS5 logo reveal at CES 2020 was a start, but Sony is surely planning something much bigger and brighter to showcase the PS5's most exciting new features.

Sony Is Not Alone

Sony isn't the first company to take this approach. Nintendo stopped conducting live, in-person E3 keynote speeches years ago, instead opting to hold pre-recorded Nintendo Direct briefings. Nintendo still holds a Nintendo Direct during E3, but the company has also padded out the Direct schedule with briefings throughout the year focused on different areas of its business. The company successfully dominates the news cycle with this approach, and it's not hard to see why Sony would seek to emulate some of that, especially with the PS5 coming up. In fact, Sony has already begun doing this with its own Nintendo Direct-style "State of Play" briefings.

Microsoft, too, is expanding and differentiating its announcements events. While Microsoft still does attend E3, and it's expected that will continue in 2020, the company has changed things up in recent years. Microsoft now holds its Xbox events at E3 at the nearby Microsoft Theatre instead of the Los Angeles Convention Center itself. Additionally, Xbox recently brought back its XO event, which was held in Mexico in 2018 and London in 2019, both of which featured major news announcements that had space and time to breathe. Microsoft also recently started its Inside Xbox remote video briefings where it is known to make significant reveals.

The landscape of major news events for gaming companies is clearly changing, and Sony is smart to create its own dedicated events for its portfolio of products.

A Window Of Opportunity For Xbox At E3 2020

With Sony bowing out of E3, that leaves room the opportunity for Microsoft to dominate the news cycle in a very important year for the Xbox brand. The next-generation Xbox Series X releases this holiday, with Halo Infinite as a launch title. Even if Sony does come out with some major news about the PlayStation 5 and its games ahead of E3, Microsoft has the chance at E3 this year to demonstrate the power and appeal of this new console and the wider Xbox ecosystem without Sony getting a rebuttal just hours later.

A report from Video Games Chronicle cites unnamed sources who said Microsoft has been planning for its E3 2020 briefing with the understanding that Sony wouldn't be there. Microsoft is said to be scaling up its plans for the show to take advantage of Sony's absence.

The Xbox One got off to a terrible start in 2013 with poor and confusing messaging related to the Xbox One and its digital practices and policies. With Xbox boss Phil Spencer now at the helm (Don Mattrick was the top boss back in 2013), Microsoft has another opportunity to start a new console cycle on the right foot. A strong E3 would go a long way toward instilling consumer confidence in the brand.

Both Microsoft and Sony will be just fine, whether they attend E3 or not. For Sony, the company is coming off the incredibly successful PlayStation 4, which stands as the No. 2 best-selling console in history, only behind the PlayStation 2. There is a huge audience of people eager to buy into what's coming next and enjoy next-gen features like faster loading times and expanded backwards compatibility, among other items.

Microsoft, too, has been riding high of late, in particular thanks to the Xbox Game Pass which already has millions of subscribers and is helping expand the number of types of games people play. The Xbox Series X looks to be a powerhouse of a console, even if you might struggle to fit it into your entertainment center. And with Xbox Game Pass getting folded into xCloud, Microsoft may truly be on the precipice of creating the elusive "Netflix of Gaming." The real money in video games is in software and services, not hardware, and Microsoft is strongly positioned.

What Sony Misses Out On

While it can be stated that E3 as a show is not as popular or important as it once was, Sony's decision to skip the show might cost the company in some regards. Not only will Microsoft have the upper hand as it relates to driving conversation at E3 and leaving the casual fans wondering, 'What about PlayStation?' but Sony won't be able to use the show to respond to Microsoft or to pad out its announcements in a way it is historically known to.

If history is any indication, fans can expect Sony to officially announce and discuss the PlayStation 5 during a dedicated event of its own before E3. For the PS4 reveal, the console was announced in February 2013 and then further detailed during E3 a few months later. This provided the company with the ability to space out its reveals to drive engagement and conversation around the console over the period of many months.

Sony also very smartly capitalized on the Xbox One's poor messaging in 2013 by using its own E3 briefing to take a shot at the Xbox One's used-game policies. It was a very memorable moment for Sony, and it must have embarrassed Microsoft and led some to doubt Microsoft's proposal. Of course, Microsoft would later reverse those policies, but the Xbox One was never able to climb out of the hole it dug itself into at the start of that generation.

Sony of course can still hold its own, separate events throughout the year to discuss the PS5 and its new features and games. But even with the scaled-down nature of E3 this year, Sony is giving Microsoft the opportunity to win the event and get all the attention.

Who Runs E3?

E3 is run by the Entertainment Software Association, which is a group that represents the interests of the video game industry in Washington, D.C. The group has not been without its controversies, as the organization most recently failed to protect the personal information of its attendees. Home addresses and other personal details were discovered to be publicly accessible. As a result, some people remarked that their trust in the ESA was eroded. To this date, the ESA has yet to formally and officially respond and address what it will do to ensure it doesn't happen again.

The ESA also generated heat for its defense of microtransaction practices. The company firmly believes in self-regulation instead of political action. The ESA is said to have dispatched lobbyists to try to kill legislative proposals that would have impacted games with microtransactions.

Also of note is an expose from Variety Gaming that shone a light on former CEO Michael Gallagher's reportedly harsh leadership and his favoring of Donald Trump. Gallagher was reportedly forced out of the ESA after membership called for his resignation.

The ESA is now run by president and CEO Stanley Pierre-Louis.

What This Means For E3 Going Forward

For its part, the ESA--which organizes E3 every year--released a statement of its own in response to Sony's announcement. The group said E3 2020 aims to be an "exciting, high-energy show" that will include new "experiences." Basically, the company is trying to get the message across that E3 2020, even without Sony, will be the same as you remember--and even bigger and more exciting this year. It remains to be seen if that will be the case, however.

"E3 is a signature event celebrating the video game industry and showcasing the people, brands and innovations redefining entertainment loved by billions of people around the world. E3 2020 will be an exciting, high-energy show featuring new experiences, partners, exhibitor spaces, activations, and programming that will entertain new and veteran attendees alike," it said. "Exhibitor interest in our new activations is gaining the attention of brands that view E3 as a key opportunity to connect with video game fans worldwide."

E3 as a show appears to be at something of a crossroads, and Sony bowing out again this year is a bad look for a show that bills itself as the biggest and most important gaming event of the year. (For what it's worth, Gamescom regularly dwarfs E3's attendance many times overr). The ESA is clearly failing to inspire Sony to see E3 as a must-attend show, and that isn't a great sign for the event.

The show will go on---E3 2020 isn't screeching to a halt just because Sony won't be there. Microsoft, Nintendo, and others are expected to attend yet again when the show kicks off on June 9, but the event may well again feel muted and lacking. Time will tell.

What This Means For Sony Going Forward

By skipping E3 this year, Sony is taking further control and command of its future. Working inside the confines of a major media event like E3 comes with its own set of limitations, either perceived or otherwise. By branching out and charting its own path, Sony gets to completely control the narrative, and it's not hard to see why this is an attractive proposition for the company, especially during an important console-release year like 2020.

Sony--and Microsoft and Nintendo for that matter--remain dues-paying members of the ESA, so the announcement to back away from E3 does not appear to portend that Sony will soon--if ever--abandon the ESA altogether. The ESA, after all, is hugely important to game companies by the manner in which it acts on the behalf of and defends video game companies on Capitol Hill.

The ESA was instrumental in helping knock down the 2011 violent video game bill that sought to limit the sale of some video games, and the group leads the charge on numerous other important issues that, while not as high-profile as the 2011 case, are still important. This may well be way Sony continues to support the ESA as a member, even if it has chosen to skip the past two E3s.

It is up to the ESA to create a show that is compelling enough in its value offering to make Sony want to come back. Whether or not that will ever happen remains to be seen. For now, Sony will do things its own way, and who could blame them?

What do you think about Sony skipping E3 again this year? Let us know in the comments below!