The E3 show used to be one of the largest game trade shows in the world but it's been very troubled since the organisers decided to make it a press-only event two years ago. Bit Tech reports many large game developers won't attend the show this year as they rather host their own shown:
Since the new E3 is invite-only for journalists, the general vibe seems to be that publishers and developers could be just as well served by hosting their own shows entirely (see Ubidays) or simply dealing with the journalists individually.
So far, a number of big names have announced they will either not be attending the show or that they are currently undecided. This includes NCSoft, that claims the event doesn't sync with any releases this year, and Atlus, that told Joystiq the event didn't do much for them financially.
More worryingly, Vivendi Activision has decided not to attend also and has gone so far as to split from the ESA group altogether - which Kotaku puts possibly at the feet of ESA president Mike Gallagher under claims of mis-management.
More recently, id Software has been in the spotlight though and Joystiq is reporting that the hugely-influential developer may yet pull out of the show too.