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ESA Revenues Decrease, Membership Fees Up

ESA Revenues Decrease, Membership Fees Up

February 25, 2009 | By David Jenkins

February 25, 2009 | By David Jenkins
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The ESA (Entertainment Software Association) raised its fees by 1700 percent since 2006 and the downsizing of E3, according to the organization’s latest tax returns.

A tax report first reported by consumer website GameSpot reveals that the ESA’s revenues fell from $29.02 million to $28.21 million for the year ended March 31st, 2008.

However, there were more significant changes in the ESA’s funding source -- it took in $18.46 million from the organization of the 2006 E3, but in 2007, that income fell to just $3.49 million as the expo was radically downsized, apparently in response to publisher demands.

The ESA has attempted to make up this shortfall with a massive increase in membership fees, with revenues rising from $4.47 million in the twelve months from April 2006 to March 2008 to $17.41 million the next year. Previously, membership income had amounted to just $1 million.

However, it's unclear whether publishers are contributing the same (or marginally increased) amounts to the ESA, with it simply being classified differently for accounting reasons when E3 took place. Gamasutra has reached out to the ESA for comment on the returns.

In January the ESA revealed it spent a record $4.24 million on federal lobbying in 2008, resulting in a spending increase year-on-year of 25.6 percent.

Nonetheless, the continuation or increase of fees without the large E3 show as a benefit may explain the rash of departures from the ESA last year, when companies including Activision, NCsoft, LucasArts, Id Software and Crave all gave up their memberships. Troubled publisher Midway is also believed to have left the ESA recently, as part of cost cutting measures.

Most of these companies indicated that their exit from the ESA was likely only to be temporary, possibly in the hope that fees would be reduced again once E3 returns to something like its previous scale. In a recent interview with Gamasutra, the ESA's Rich Taylor promised that this year's event would "return to a bit of the buzz and excitement" of previous years.


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