According to data released by the Entertainment Software Association (ESA), around one-third of Americans ages 13 and older play video games on their smart phones, tablets, and portable gaming devices (3DS, PS Vita, etc.) on a regular basis. The new research comes from a new ESA report, "Mobile Games: Expanding Gameplay Across America."

Update: Polygon is reporting that the meeting between the ESA President Michael Gallagher and Joe Biden's task for on gun violence also reportedly included executives from many major publishers, researchers, and the nation's biggest video game retailer.

Guess who else is doing the happy dance over the FTC’s recent findings that the video game industry continues to surpass all others when it comes to retail enforcement.

That’s right, it’s the Entertainment Software Association, the industry trade group for video game publishers in the U.S.  Said ESA president Michael Gallagher:

“The ESRB is the gold standard. Our self-regulatory system works and this FTC report validates it as being the best in the entertainment industry.  We have an unparalleled commitment to working with parents, retailers, and stakeholders, and will continue to help ensure that this remarkable level of enforcement remains high.”

“Those who would criticize the industry’s commitments are either ignorant of facts or are actively pursuing a political agenda.”

AE:  Ooh, burn!

Members of Congress and representatives from the video game industry launched a new caucus this morning at an event on Capitol Hill, reports Gamasutra. The "Caucus for Competitiveness in Entertainment Technology" (E-Tech Caucus) wants to champion issues that help foster growth in the interactive entertainment sector.

This first caucus meeting is attended by Congressman Kevin Brady (R-TX), co-chair and Congresswoman Debbie Wasserman Schultz (D-FL), Cooney Center executive director Michael H. Levine, Ph.D., Entertainment Software Association CEO Michael Gallagher, and other members of the caucus.

Entertainment Software Association (ESA) President Michael Gallagher is “humble” about how trade group might fare in front of the U.S. Supreme Court, as the nation’s highest court prepares to rule on Entertainment Merchants Association (EMA) v. Schwarzenegger, which centers on a California law that attempts to make it illegal to rent or sell violent videogames to underage consumers.

In a pre-E3 briefing recounted by Joystiq, Gallagher said about the case, “We believe we're on the side of right here. We've believed that for 10 years. That hasn't wavered one iota. You go into this preparing to win, but also very prepared to handle the other conclusions as well”

The Video Game Voters Network (VGVN), an organization backed by the Entertainment Software Association (ESA), announced that it has eclipsed the 200,000 member mark.

Launched in 2006, the VGVN bills itself as “a place for American gamers to organize and defend against threats to video games by registering to vote and letting Congress know how important this issue is to the community.” The organization said that it leveraged its user-base 46 times last year in order to get thousands of letters sent to politicians regarding political legislation.

Michael Gallagher, President of the ESA, had this to say about VGVN’s grass-root members, “They support their choice of entertainment by contacting elected officials and making their voices heard. Our industry is fortunate to have these dedicated individuals helping to preserve the rights of computer and video game consumers and makers.”

The Entertainment Software Association (ESA) has announced the addition of its first two new members of 2010.

Deep Silver, a publishing division of Koch Media, was launched in 2002 and has published over 60 titles. Fellow new member Slang, who specializes in publishing Hispanic-themed titles, will launch its first game (Lucha Libre AAA: Heroes del Ring) this summer.

ESA President Michael Gallagher on the additions:

Deep Silver’s and Slang’s membership in the ESA reflects the diversity of our industry. ESA’s growing roster also highlights the continued importance of our goals of protecting intellectual property rights, preventing piracy, and upholding freedom of speech.

With the two new members, the ESA now counts twenty-nine members in all.

Washington State Attorney General Rob McKenna (left) has partnered with game publishers' lobbying group ESA and Web Wise kids on an educational program aimed at keeping children safe online.

A press release issued by McKenna's office quotes the A.G. on the initiative:

The devices that kids love, from smartphones to computers, are also being used to subject them to cyberbullying, scams and online stalkers. This program deploys a technology that’s very familiar to kids – video games – to teach   important lessons about staying safe in cyberspace.

ESA boss Michael Gallagher was on hand for the announcement, along with Web Wise Kids president Judi Westburg Warren and Washington's Superintendent of Public Instruction Randy Dorn. Gallagher offered his comment:

The ESA Foundation is proud to provide the resources to launch this cutting-edge initiative. With the industry presence of Microsoft, Nintendo and other leading video game companies, Washington is a natural fit for launching this program. Working together, we believe the Web Wise Kids program will help educators teach Washington’s youth how to stay safe online...

A.G. McKenna, a Republican, has previously endorsed the ESRB rating system.

Video game publishers group ESA has released its annual report for the 2009 fiscal year, which concluded at the end of March.

As noted by Venture Beat,

The ESA fought 43 bills aimed at regulating content or controlling access to video games and none became law... Meanwhile, five states enacted tax incentives for the creation of game development jobs. Another 17 states are considering enacting the incentives.

The group said that it will be hard to get the attention of the federal government and Congress, which is preoccupied with issues such as climate change and healthcare. The ESA wants more done to stop piracy of games...

The Entertainment Software Association has filed a federal lawsuit against the Chicago Transit Authority, challenging a 2009 CTA ordinance which prohibits ads for games rated M (17+) or AO (18+) from appearing on its vehicles and facilities. 

GamePolitics readers may recall that in April, 2008 the CTA ordered ads for Grand Theft Auto IV removed from buses even before the game was released. The CTA action followed local news coverage of a rash of shootings in Chicago.

Shortly thereafter, GTA IV publisher Take-Two Interactive sued the CTA, charging that the agency had broken a $300,000 contract for the campaign. The parties settled the case later in 2008, with the CTA granting T2 a six-week GTA IV ad run. However, CTA officials moved to block future ads for M-rated games by passing the new ordinance, which took effect on January 1st and prompted today's legal action by the ESA.

ESA boss Mike Gallagher commented on the lawsuit in a press release: 

The CTA’s ordinance constitutes a clear violation of the constitutional rights of the entertainment software industry. Courts across the United States, including those in the CTA’s own backyard, have ruled consistently that video games are entitled to the same First Amendment protections as other forms of entertainment. The CTA appears unwilling to recognize this established fact, and has shown a remarkable ignorance of the dynamism, creativity and expressive nature of computer and video games. The ESA will not sit idly by when the creative freedoms of our industry are threatened.

The press release also explains some of the legal rationale behind the suit:

The ESA’s suit contends this new ordinance unconstitutionally “restricts speech in a public forum that is otherwise open to all speakers without a compelling interest for doing so.” In addition, the Complaint argues that the ordinance impermissibly discriminates on the basis of viewpoint and ignores less restrictive means of achieving the supposed ends of the ordinance.  

The ESA also stated that the CTA’s ordinance is unnecessary because game-related marketing is already subject to the Entertainment Software Rating Board’s Advertising Review Council (ARC), which strictly regulates computer and video game advertisements that are seen by the general public.  The Entertainment Software Rating Board (ESRB) assigns content ratings to computer and video games, which, in turn, are displayed on the advertisements for those games.

As GamePolitics has reported, the Massachusetts Bay Transit Authority has a similar ban on M-rated game ads, likening them to X-rated movies. It is unclear at this time whether the ESA will pursue a similar action against the MBTA.

While the lawsuit also encompasses AO-rated games, as a practical matter, such titles are virtually non-existent in the U.S. market.

DOCUMENT DUMP: Grab a copy of the lawsuit here (70-page PDF)...

The recent discussion concerning the ESA's desire to have its rating organization, the ESRB, evaluate game content for the iTunes App Store brings a number of questions to mind:

1.) Why?

Having watched how corporations, lobbyists and their related entities do business for some time now, I'm too jaded to believe that ESA/ESRB wants to jump into rating App Store games for the good of society or because it's the right thing to do. This would, after all, be a significant commitment of ESRB resources. Generally such things happen because there is revenue to be made or there's power to be grabbed.

Despite its present chaotic nature, the App Store is a rising star in the game space. Getting in on the ground floor would be a coup for the ESRB. Apple has a lot of money, too, and the ESRB is paid a fee by the developer/publisher for each game it rates. Despite my cynicism, ESRB spokesman Eliot Mizrachi told me that it's not about the Benjamins:

ESRB is a non-profit organization funded by the revenue generated from the services we provide the industry.  Given our highly discounted rate for lower-budget games, rating mobile games is not a financially attractive proposition; however we believe making ESRB ratings available for those games would serve consumers well.  Parents are already familiar with ESRB ratings and find them to be extremely helpful in making informed choices for their families.  
 
To be clear, our desire is to see Apple integrate ESRB ratings as an option in its parental controls and display a game’s rating (if it has one, the ratings are voluntary after all) in the App Store or on iTunes prior to purchase, not to require that every game available via an iPhone carry an ESRB rating (just as not every piece of video content available will carry an MPAA or TV rating). 

 

Apple’s integration of ESRB ratings into its parental controls for iPhone games would afford parents the ability to block those video games that carry an ESRB rating utilizing the same tool they are being offered to block video content that has been rated by the MPAA or carries an official TV rating.  It’s about giving parents the same ability to do on the iPhone what they are being offered with other entertainment content and can already do on game consoles and other handheld game devices.     

2.) What would it cost?

I asked the ESRB what it costs a developer/publisher to have a typical console game rated?  Would the cost to rate an iPhone game be less? Mizrachi said:

Our standard fees for getting a game rated cover the costs of providing that service.  However, to make accommodations for lower-budget product like casual and mobile games, several years ago we introduced a highly discounted rate - 80% less - for games that cost under $250,000 to develop.  We believe most iPhone games would likely be eligible for the discounted rate.

3.) Isn't this a lot of extra work for ESRB?

Mizrachi was asked whether the ESRB has the capacity to handle an influx of iPhone games for rating. His response:

ESRB has seen increases in rating submissions each year since its founding and has always been able to keep pace.  We have rated more than 70 mobile games to date and will undoubtedly rate more in the future as the market grows.  Consumers of those mobile games that have been assigned ESRB ratings should have access to rating information, and if parental controls are available, the ESRB rating should ideally be operable within that framework. 

4.) If the ESRB plans to do App Store games, what about Xbox 360 Community Games (soon to be known as Indie Games)? 

I also asked Mizrachi about the indie games on XBL. Wouldn’t they seem to be a more natural focus for the ESRB before targeting iTunes? Mizrachi said:

Once XNA games graduate to XBLA they are rated by ESRB... ESRB isn't "targeting" iPhone games.

5.) Who would pay for ESRB to rate App Store games?

Not the creators of $0.99 games, for the most part. They are apparently not making significant revenue. Apple has a deep pocket, of course, although they are not the creator of the games for sale on the App Store. Perhaps the larger industry players such as EA, Namco, etc. would foot the bill for their games. They are already accustomed to dealing with the ESRB.

6.) If only some games are rated, why bother?

But then again, if only the commercial game apps from major publishers are rated, how does that stop your kid from downloading Baby Shaker or Hot Dog Down a Hallway? The foundation for the retail employment of ESRB rating is its ubiquity. Major retailers won't carry non-rated games. Thus, parents have a reasonable expectation that their 12-year-old will be turned down if he tries to buy GTA IV. If not all App Store games are rated, such an expectation is not applicable. So, what's the point?

Hopefully we will learn more about the ESRB's plan as we go forward.

We posted a story on this last Thursday, but here's exclusive video footage from GP's mobile phone which shows Los Angeles Mayor Antonio Villaraigosa welcoming E3 2009 to town.

To the left of Villaraigosa is ESA boss Mike Gallagher.

Do games on the iTunes App Store need to carry ESRB ratings?

In recent times there have been a number of questionable developments in regard to iPhone apps. Some were banned that perhaps shouldn't have been. Others were cleared for sale despite containing questionable content.

Kotaku reports that ESA boss Mike Gallagher would be open to working with Apple on rating App Store games:

We’ve been down this road before, the entertainment software industry, we know how this goes and it’s wise for (Apple) to make steps in that direction so that this is addressed up front and there is an environment that is hospitable to children and families. It would be wise to do that, we would welcome the opportunity to work with them, we are reaching out to encourage that.

 

That doesn’t mean that every entrepreneur, every software engine that is able to write code and put up an app on the App Store is going to go through this process it simply says that if a game is rated it needs to pass through and be filtered appropriately by the controls that are on the iPhone. That would be a big step in the right direction and it is virtually friction free.

GP: While App Store offerings clearly need some kind of coherent rating system, it's unclear whether the ESRB is the right vehicle. As Gallagher notes, there is a high volume of games on the App Store. If all are not to be rated, of what value is a rating system? Who decides which games need to be rated? What is the ESRB's operational capacity to absorb App Store games into its workload?

Not mentioned by Gallagher, but clearly a factor, are the fees paid by developers to the ESRB have games rated. As GamePolitics reported just yesterday, most App Store games are not making money. Will small-time developers of $0.99 games who are hoping to catch lightning in a bottle on the App Store participate in a rating system which requires them to fork over to the ESRB up front? It seems unlikely.

A year ago I pronounced E3 dead.

I was wrong.

Of course, when I wrote those words, the impressive expo staged last week was not what I had in mind. Instead, as 2008's pitiful show wound down, I checked E3 for vital signs and found none. I wasn't alone, of course. E3 2008 was awash in criticism from media and industry types. Even Mr. Sims himself, Will Wright, termed the show "the walking dead."

But this year's E3 has to be - by any measure - rated a success. While it wasn't the exercise in rampant game biz excess that we experienced in prior years, it had ample excitement and plenty of buzz. And, truth be told, sharing the L.A. Convention Center with 41,000 other attendees was a far more pleasant experience than the godawful crush caused by the crowd of 80,000 let into the last big E3 in 2006.

In any case, kudos must be paid to the ESA and its member companies for following up on their commitment to turning E3's sinking ship around. The expo, of course, is the video game industry's annual chance to strut its stuff and it deserves to be a showcase. Hell, gamers want it to be a showcase. It's no secret that gamers drool over E3, yours truly included. Personally, 2009 was my 12th trip to the big dance. I've attended E3 in Atlanta, Santa Monica, and - a bunch of times - at the LACC. Afterward, I return home feeling re-energized about games and maybe even a bit let down by the prospect of life without 50-foot high displays, pulsing lights, amped-up music and booth babes.

To let E3 and its storied history just fade away might seem unthinkable, but that's exactly the direction in which the industry was heading when it allowed bean counters to dictate policy. Thankfully, those who understand just how important E3 is to the video game community stepped in and saved the day.

During Tuesday's E3 state-of-the-industry speech ESA boss Mike Gallagher touched on a number of issues. In this post we'll take a look at his comments on politics and the video game industry:

On Barack Obama's Xbox Live campaign ads:

Then-presidential candidate Barack Obama purchased advertising space within video games during his presidential campaign... In doing so, Obama became the first presidential candidate to use video games to engage voters and court their support. Others will inevitably follow...

On state-funded financial incentives for video game developers:

You may recall that Texas Governor Rick Perry delivered our keynote address last year... A true advocate for the industry, he backed up his words over the past year. He proclaimed February 3 “Entertainment Software Day” in Texas. Then, in April, he supported [legislation] tripling the economic incentive programs in Texas for digital interactive media production...

 

A growing number of elected officials increasingly view incentives for video game companies as an essential component in any plan designed to revive a local economy... This year, 18 states have actively considered legislation to create or significantly expand existing incentive programs for digital interactive media development and production...

On restrictive video game content legislation:

Of course, there remain some in government who still seek to lay society’s ills at our doorstep. We are vigilant in defending the interests of the video game ecosystem...

 

We have seen demonstrable proof that [the Video Game Voters Network's] powerful activism can stop a bad legislative proposal from becoming an even worse law. In Utah, for example, gamers stepped up, encouraging Governor Jon Huntsman to reject a piece of flawed legislation. The governor heeded their call and, in March, vetoed the bill. This decision represented a great win for both gamers and the industry at large. For the first time, a governor vetoed legislation that would have profoundly affected video games, consumers and the industry...

GP: With all due respect to Gallagher, from here it seemed that the industry's substantial lobbying efforts in Utah had far more to do with Gov. Huntsman's veto than e-mails generated by the VGVN.

That said, Gallagher's speech was a notable improvement over the 2008 version for a couple of reasons. First, it was moved to the L.A. Convention Center's comfortable and cozy theater. Last year's speech was delivered in a cavernous - and mostly empty - meeting room. More importantly, after wrapping up this year's talk Gallagher provided a question-and-answer period, something he didn't offer his audience in 2008.

During the Q&A I took the opportunity to ask Gallagher about the U.S. Supreme Court's pending consideration of California's violent video game law. If the Court rejects California's bid, I asked, did the ESA boss think the other 49 states would take notice and stop attempting to legislate games?

No, [they] won't... 12 times we've been to federal court and had those statutes overturned, [but] they continue to do it... We'll face challenges in different states at different times. What I can you tell you is, our advocacy and the growth of our industry is beginning to turn that issue around. An example I would point to is the number of legislators who introduce these bills has stopped. They didn't do it this year. That happened in North Carolina, it happened in Massachusets, it happened in Michigan and other states. And in some of those cases, we've taken our harshest critics and turned them around to where they are sponsoring legislation to give our industry incentives to locate in their state. So I see opportunity for this industry to continue to make its case...

 

We are going to turn that issue. And we are having an impact today. But we continue to have to be very vigilant...

On Tuesday Los Angeles Mayor Antonio Villaraigosa officially welcomed E3 back to the City of Angels with a presentation to ESA boss Mike Gallagher and a ceremonial ribbon cutting.

And, why not? As the Los Angeles Times reports, E3 2009 generated more than $15 million in commerce for the city.

There's no truth to the rumor, by the way, that those giant scissors are a new Wii peripheral.
 

Los Angeles Mayor Antonio Villaraigosa (D, at left) will extend an official welcome to E3 2009 tomorrow afternoon, according to a press release issued by the Entertainment Software Association, which operates the expo.

The 3:30 p.m. ceremony will mark the official opening day of E3 and will feature a ribbon cutting by Mayor Villarigosa, ESA boss Mike Gallagher and Mark Liberman, head of LA INC.

The event will take place outside the West Hall lobby of the Los Angeles Convention Center.

There's one in every crowd.

While the video game press is generally enraptured by the prospect of E3 returning to its former glory, Cnet's Dan Ackerman serves up a cautionary note, saying that this year's expo "may be too little, too late."

Ackerman explains:

The 2009 version of E3 is being unofficially billed as a return to form... Of course, many of these grand plans were hatched before the current economic recession hit, and some of these game companies may be experiencing buyer's remorse over investing so heavily in an E3 show modeled on the free-spending glory days.

We're eager to see how excessive the show's booths are (previous years resembled an arms race to see who could build the biggest, most ostentatious display), and whether the game publishers will feel like they got their money's worth from their sizable investment -- which is why the show was scaled back three years ago in the first place... If not, this could very well be E3's third strike, and the end of a 15-year run.

On Wednesday game publishers' lobbying group ESA issued a press release praising members of the bipartisan Congressional International Anti-Piracy Caucus for singling out Spain, Canada, Mexico, Russia and China as anti-piracy priorities for 2009.

ESA CEO Michael Gallagher praised the IAPC in a press release:

We thank the Caucus for this year issuing a challenge to Canada and Mexico to pass additional legislative protections – such as prohibitions on ‘mod chips’ and other circumvention devices that are used to play pirated games – and to follow through with greater enforcement and border controls.

We also thank the Caucus for highlighting the severe problems that exist for our industry and other copyright industries in Spain. Online and peer-to-peer piracy are rampant and virtually unchecked in Spain and in other major European markets...

But Nick Farrell of the U.K.-based Inquirer, doesn't think much of the caucus, implying that the senators and representatives on the IAPC have been lobbied by the RIAA and other IP rights holders. Farrell writes:

The RIAA has got its tame politicians in the US congress to rail at other nations that don't hold such a jack-booted attitude toward copyright infringement as the Land of the Free...

[IAPC] singled out Baidu, China's largest Internet search engine, as being "responsible for the vast majority of illegal music downloading in China." That's interesting, because Baidu does the same thing as Google which, as a powerful US company, the music industry has not dared to denounce...

It seems almost as though the entertainment mafiaa would like the US to mount a cross-border raid into Canada over its perceived lack of draconian copyright enforcement and wants the US to treat its NATO ally Spain as a pariah for having the temerity to say that peer-to-peer file sharing over the Internet isn't a crime.

As GamePolitics has reported, California is appealing the constitutionality of its 2005 video game law to the U.S. Supreme Court. Reaction by the video game industry has been both swift and blunt.

Entertainment Software Association CEO Michael Gallagher issued a statement criticizing California's decision to petition the Supreme Court:

California’s citizens should see this for what it is—a complete waste of the state’s time and resources. California is facing a $21 billion budget shortfall coupled with high
unemployment and home foreclosure rates. Rather than focus on these very real problems, Governor Schwarzenegger has recklessly decided to pursue wasteful, misguided and pointless litigation.  

We are confident that this appeal will meet the same fate as the State’s previous failed efforts to regulate what courts around the country have uniformly held to be expression that is fully protected by the First Amendment. California’s taxpayers would be better served by empowering parents and supporting the ESRB rating system.

Meanwhile, Sean Bersell (left), VP of Public Affairs for the Entertainment Merchants Association, forwarded a statement to GP:

It boggles the mind that, on a day when the state of California finds itself in the worst fiscal crisis it has ever faced and is considering massive layoffs of teachers and cuts to public services, the state would choose to waste tens of thousands of dollars on pursuing this frivolous appeal.

This law was found by two lower courts, relying on long-established legal precedents, to be unconstitutional as an infringement of the First Amendment. There have been eight similar laws enacted around the nation this decade and every single one has been found unconstitutional on similar grounds. There is no reason to expect a different outcome in the Supreme Court.

So far, this case has cost the state of California approximately $400,000 just in legal fees and court costs that it has had to pay the plaintiffs. This doesn’t even include the state’s legal fees and costs. And if this appeal is unsuccessful, as it will be in all likelihood, the state will owe the plaintiffs even more in legal fees and court costs.

The taxpayers of California should demand that their elected officials stop wasting precious tax dollars on this quixotic quest.

Both the ESA and the EMA (under its former name VSDA) are parties in the California case. The EMA maintains a web page listing background on VSDA v. Schwarzenegger.

For the first time ever, the United States Supreme Court will consider a case involving a restriction against the purchase of violent video games by minors.

GamePolitics has just received the news by way of a press release from the office of California State Senator Leland Yee (D). It was Yee who sponsored the contested video game law as an Assemblyman in 2005. The bill was signed into law by Gov. Arnold Schwarzenegger in October, 2005, triggering a court battle with between the state and the video game industry which will now extend to the U.S. Supreme Court.

The law, scheduled to take effect January 1st, 2006, never became effective due to an injunction issued by U.S. District Court Judge Ronald Whyte in December, 2005. Judge Whyte would eventually go on to permanently enjoin the law in August of 2007, ruling it unconstitutional. Gov. Schwarzenegger, however, ordered an appeal to the U.S. 9th Circuit Court.

In February of this year, a three-judge panel of the 9th Circuit upheld Judge Whyte's ruling, leaving the U.S. Supreme Court as California's last option, an option that Gov. Schwarzenegger has now chosen to exercise. Schwarzenegger's comments are contained in the press release:

I signed this important measure to ensure parents are involved in determining which video games are appropriate for their children. By prohibiting the sale of violent video games to children under the age of 18 and requiring these games to be clearly labeled, this law would allow parents to make better informed decisions for their kids. I will continue to vigorously defend this law and protect the well-being of California’s kids.

For his part, Yee, a child psychologist by trade, said:

I am hopeful that the Supreme Court – which has never heard a case dealing with violent video games – will accept our appeal...  

 

Passing this law was not easy and thus we should not expect the court proceedings to be any different. The multi-billion dollar video game industry relies on the revenue generated by the sales of these extremely violent games to children; thus they have the desire and resources to fight this cause at every turn.  Despite their high-priced lobbyists, they were unsuccessful in the Legislature and despite their high-priced lawyers, I am hopeful they will inevitably face the same fate in the courts.

California Attorney General Jerry Brown (D), whose office will handle the SCOTUS appeal, added:

California’s children are exposed everyday to video games that glamorize killing sprees, torture and sexual assault. In the face of this brutal violence, I am petitioning the Supreme Court to allow the state to enforce its reasonable ban on violent video game sales and rentals to minors.

The A.G.'s office has initiated the appeal by filing a petition for a writ of certiorari. As GamePolitics readers may recall from the recent Jack Thompson appeal, the Supreme Court process dictates that the justices as a group will consider California's petition in private conference at a later date. If four of the nine justices vote to grant California's petition, the case will advance to the filing of briefs. Otherwise, the appeal will end.

The Entertainment Software Association will incorporate a variety of charitable efforts into next month's E3 Expo in Los Angeles.

According to an ESA press release, in addition to all of its usual gaming goodness, E3 2009 will feature:

• Pro vs. G.I. Joe gaming competitions in support of U.S. military personnel
• A t-shirt design contest with some proceeds going to support an L.A.-based homeless mission
• a Red Cross blood drive

For more info, check out the official E3 site. Those wishing to donate blood should sign up online, entering E3 as the sponsor code.

Those pesky Canadians have finally pushed the U.S. Government to the brink.

If the Bushies were still in power we might now be glued to CNN, watching the 82nd Airborne para-dropping into Ottawa. But as it is, the Obama administration has settled for delivering a nasty slap via the office of U.S. Trade Representative Ron Kirk (left).

The issue is copyright protection and the USTR, a cabinet-level post, has been making unpleasant noises in Canada's direction for several years. Today Kirk dropped the hammer, placing Canada on the "Priority Watch List" along with China, Russia, Algeria, Argentina, Chile, India, Indonesia, Israel, Pakistan, Thailand, and Venezuela. From the USTR report:

Canada is being elevated to the Priority Watch List for the first time, reflecting increasing concern about the continuing need for copyright reform, as well as continuing concern about weak border enforcement.

The Entertainment Software Association, which lobbies on behalf of U.S. video game publishers, was quick to applaud the action in a press release. No surprise there, as the ESA has been pushing hard in recent years for Canada to outlaw mod chips and adopt its own version of the consumer-unfriendly Digital Millenium Copyright Act.

In fact, with DMCA-like legislation an issue that Canada's Parliament will soon be considering, a cynic might be forgiven for thinking that the USTR's action was timed for its persuasive value as much as anything else.

Of today's announcement, ESA CEO Michael Gallagher commented:

Putting Canada on the ‘Priority Watch List’ is a signal of the Obama Administration’s commitment to strengthening global intellectual property protection, and its intent to address this issue firmly with the Canadian government. Canada’s weak laws and enforcement practices foster game piracy in the Canadian market and pave the way for unlawful imports into the U.S.

So what does the ESA want from Canada? They have a laundry list:

• Enact legislation outlawing game circumvention devices, such as “mod chips” and “game copiers,” in line with Canada’s international treaty obligations
• Create adequate legal incentives for internet service providers (ISPs) to work with copyright owners in combating online piracy
• Provide Customs officials with adequate authority to make ex officio seizures of counterfeit and pirate product at the border; and,
• Provide adequate resources to anti-piracy enforcement efforts and make prosecution of intellectual property crimes a high priority.

As GamePolitics readers know, a study released last week by Dr. Douglas Gentile of Iowa State University and the National Institute on Media and the family suggested that "nearly one in ten" 8-18 year-olds showed signs of video game addiction.

The research has been under fire, however, from the video game industry as well as from less biased critics such as Harvard's Dr. Cheryl Olson and ABC News Polling Director Gary Langer.

Yesterday game publishers lobbying group the ESA released a letter in which CEO Michael Gallagher criticized the study for a sampling error that has been acknowledged by Gentile. Gallagher also bemoaned the wide coverage which the flawed study has received from mainstream media outlets.

GamePolitics asked the National Institute on Media and the Family to respond to the ESA's criticism; we've just received this statement from NIMF President Dr. David Walsh:

Everyone knows at least one child who has struggled with balancing healthy game playing with academics and family life. Unfortunately, as Dr. Gentile’s study suggests, some children have more significant problems with gaming.  Regardless of whether you agree with the exact statistics in Dr. Gentile’s study, it provides the gaming industry, medical experts, and public policymakers with a new opportunity to have a thoughtful conversation regarding the effects of video games on kids.

One study will not determine if gaming is addictive for some kids. Again, additional research is required to determine if video games are as ‘addictive’ as gambling and alcohol. With this additional research, the medical community can make an educated decision on video games and addiction.

We look forward to leading the conversation with the industry, policymakers and parents on this important public health issue.

GP: Walsh discusses the research in the video at left. To be clear, the video does not address the sampling issue raised by the ESA.

Last week the National Institute on Media and the Family along with Iowa State University Prof. Douglas Gentile released a study which claimed that 8.5% of 8-18 year-olds displayed signs of video game addiction.

The research, published in the journal Psychological Science, was quickly challenged, most notably by Harvard's Dr. Cheryl Olson (co-author of Grand Theft Childhood) and ABC News polling director Gary Langer.

Citing Langer's report on the study's flawed research methodology, game publishers' lobbying group the Entertainment Software Association yesterday sent a letter to the editor of Psychological Science, Purdue University Prof. Robert Kail. ESA CEO Mike Gallagher questioned the validity of the NIMF/Gentile findings and complained that their alarming assertions regarding video game addiction received wide coverage in the mainstream media.

It is safe to say that the sole reason the [Gentile] study generated the kind of media attention it did was due to the inclusion of specific numbers that would appear to have been based on scientific research. In fact, the numbers reflected no such thing. Because of the composition of the group studied, neither the overall figure, nor the cited sampling error is supported by the data Dr. Gentile presented. 

 

We accept Dr. Gentile’s [subsequent] admission of [sampling interpretation] error at face value, although it is hard to understand how a researcher would base a scientific study upon an assumption about the nature of the group he was studying. It is not that Dr. Gentile did not have time to make sure that the group was a truly national representative sample: the data was collected in January, 2007...

Gallagher concluded by asking Kail to advise Psychological Science readers of the discrepancy between the sampling reported by Gentile and that upon which the study was actually based. For a detailed explanation of the sampling issue, see Gary Langer's ABC News post.

The operators of the wildly popular file-sharing site The Pirate Bay have been found guilty of copyright law violations by a Swedish court.

As reported by the BBC, Frederik Neij, Gottfrid Svartholm Warg, Carl Lundstrom and Peter Sunde have been sentenced to a year in jail and ordered to pay 30m kronor (US$3.5m).

Prior to verdict the four defendants indicated that they would appeal if convicted. From the BB:

Millions of files are exchanged using the service every day.

No copyright content is hosted on The Pirate Bay's web servers; instead the site hosts "torrent" links to TV, film and music files held on its users' computers.

UPDATE: Michael Gallagher, head of game publishers' lobby ESA has applauded the TPB verdict:

Piracy is the single greatest threat to the development and release of innovative and creative entertainment software that consumers demand and enjoy. It’s a job killer in an economy that needs millions more jobs, not less. This decision confirms that the harm being inflicted on creators of digital works by BitTorrent sites like The Pirate Bay will not be tolerated, and that such actions are subject to criminal sanctions.

UPDATED

Having been passed overwhelmingly by the Utah House and Senate, HB 353, the Jack Thompson-conceived video game/movie bill, is now with Gov. Jon Huntsman (R).

The Guv can decide to sign the measure into law or veto it. He may also do nothing, in which case the bill will automatically become law. Given that Utah conservatives have portrayed the bill as protective of children and Huntsman is rumored to have 2012 presidential aspirations, it's highly unlikely that he will exercise his veto power.

With HB 353 landing on Huntsman's desk, game publishers' lobbying group the Entertainment Software Association has upped the pressure ante a bit. The ESA-owned Video Game Voters Network is running an e-mail campaign which urges Huntsman to veto HB 353.

ESA VP of Communications and Industry Affairs Rich Taylor also criticized the bill in an interview with Salt Lake City public radio station KCPW:

Essentially, what it does it has the unintended consequence of creating liability exposure which could force many retailers to either abandon their voluntary policies to enforce video game rating systems, or maybe perhaps choose not to sell video games at all.

Here you have broadly drawn legislative language that seeks to address a fairly small instance of retailers failing to enforce their policies as promoted. The vast, overwhelming majority of retailers are complying, but now they fall within this swinging sight of harm that this legislation introduces.

For his part, Jack Thompson has challenged ESA CEO Mike Gallagher to a debate on the bill, but that's an unlikely occurrence.

Assuming that Huntsman signs the bill into law, it will take effect on January 1, 2010. If and when Huntsman signs, the video game industry will decide whether to challenge the measure in federal court.

Also unclear at this point is where the motion picture industry stands on HB 353. If the ESA and EMA (game retailers) sue, will the MPAA join in?

UPDATE: An industry executive who has been actively involved in the fight against HB 353 assures GamePolitics that the MPAA and the National Association of Theatre Owners are fully engaged in opposition to the bill.
 

As legislators in Texas consider expanding financial incentives for game developers and other producers of entertainment media, ESA boss Michael Gallagher weighs in with an op-ed in the Austin American-Statesman:

With over 90 development companies in Texas, the video game industry accounted for more than one-third of the moving media industry's $345 million investment in the state in 2007. In addition to the more than 7,500 jobs that the industry currently supports in Texas, the Texas Comptroller of Public Accounts found in a recent report that video games "have a ripple-effect and spread technological innovations to other industries..."

The opportunity now falls on the Texas state legislature, however, to pass the bills that will keep the industry's momentum in the Lone Star State going. Texas currently risks falling behind several states in economic incentive programs for the entertainment industry. This year alone, thirteen states are actively considering legislation that will either create or significantly expand their existing incentive program for digital interactive media development and production...

While economic incentives for the video game industry are a sound investment for Texas' cultural legacy, they are an even better investment for the people of Texas.

The Entertainment Consumers Association (ECA) has been lobbying for Universal Broadband for some time. Now, game publishers' trade group the Entertainment Software Association (ESA) appears to be moving in that direction as well.

Congress Daily reports that ESA CEO Michael Gallagher sees affordable high-speed Internet access as "connective tissue" that member companies need to weather the widening recession.

It's not hard to see why. Modern gaming staples such as DLC and online multiplayer require fat pipes. Gallagher elaborated on the issue:

We're the only form of entertainment online that's interactive -- movies and music are linear. We're very pleased with the president's strong embracing of broadband deployment as a high value goal for our country.

 

The administration and Congress have a huge amount to contribute to make sure that resources are available and make sure that rules of the road encourage investment and give companies and customers access to it at reasonable prices and terms.

Gallagher also dished on piracy and legislative issues.

FULL DISCLOSURE DEPT: The Entertainment Consumers Association is the parent company of GamePolitics.

Despite a bumpy two-year run which has seen a 25% membership drop and a disastrous 2008 E3, Michael Gallagher, CEO of the Entertainment Software Association, is doing okay for himself.

IRS records filed by the ESA indicate that Gallagher was paid $789,929 for the reporting period of April 1, 2007 to March 31, 2008. Since Gallagher didn't take over at the ESA until late May of 2007, or almost two months into the reporting period, we can probably assume that his annual salary was actually a bit higher. Additionally, Gallagher collected $19,015 in benefits.

By way of comparison, Gallagher's predecessor, Doug Lowenstein, earned $744,344 for the prior year, plus a benefits package valued at $96,616.

It's only fair to point out in Gallagher's defense that many of the conditions which led to a downsized E3 and drastically elevated membership fees were in place before he was hired.

On the same document the ESA reports the salary of ESRB President Patricia Vance as $535,397. It's apparent that the head of the video game industry's rating body has bounced back nicely from the 2005 Hot Coffee fiasco. Highlighted by a successful outreach program to parents and public service messages delivered in concert with various state-level political officials, the ESRB seems to be performing at peak efficiency.