Microsoft Corp. descended on Los Angeles last week, booking 5,000 hotel rooms for the Electronic Entertainment Expo the biggest video game trade show on earth. With an army of 1,000 employees working the show, the software giant had a lot to prove: it launched the Xbox 360 last year, so while rivals Sony Corp. and Nintendo Corp. were unveiling their next-generation consoles, Microsoft had to dress up its ancillary offerings, like the Xbox Live Online game-playing community, its coming cell phone offerings and, of course, new games.

But Microsoft is no tourist here. Its Southern California offices recently moved from Santa Monica to downtown L.A., and beefed up its staff to more than 300 employees.

Most of the year, those employees are engaged in consulting services, enterprise software sales, e-mail security, and working with Hollywood creative-types and music industry executives. But last week, the office was pretty empty. “As you might imagine, we have a fair number of gamers on my staff,” admitted Sandi Thomas, general manager of Microsoft, Southern California. Most employees went to E3 in the nearby Staples Center. “They all like to try and push the software to its limits.”

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Walk into the main hall at the Staples Center and you were sucked into the belly of Electronic Arts Inc.’s death-star, a circular high-definition screen. The blaring 360-degree display inspired shock and awe last year. Reprising the same booth, in the same location, two years in a row still wowed first-timers but some of the magic was lost.

Santa Monica-based Activision Inc. upstaged EA, securing 12,000 feet of booth space right next door. It included a working vert-ramp a skateboarding half-pipe so that skateboard and video game icon Tony Hawk could do a few tricks.

EA’s booth disgorged people into “Enemy Territory: Quake Wars,” Activision’s latest PC game. Fifty large flat-screen video displays dropped down from all sides. There were enough game displays for 16 people to play against each other. Though EA is the industry giant, with $3.1 billion in revenues last year, Activision is declaring it a competition with $1.4 billion in revenues.

The new spot offered maximum exposure and wow-factor.

“It’s about acting like a leader in the industry,” said Robin Kaminski, head of global brands management for Activision. “It’s not about wondering, ‘what’s EA going to do this year?'”

Activision was showing three titles for the new PlayStation 3 and the new Nintendo Wii console, four Xbox 360 titles, five Playstation Portable titles, and five Nintendo DS hand-held games.

“Success in this cycle depends on games that make the hardware fun,” she said. “It’s not about the pretty girls on a stage, it’s not about fire dancers it’s about the game.”

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Rather than try for mass appeal, THQ is honing in on game enthusiasts, and making a more aggressive play for the PC gamer, she added. It was displaying three new titles for Xbox 360, under development for the PlayStation 3, and had three games in development for Nintendo Wii. But Pieri said most of the company’s meetings with retailers and analysts happen in the days before the actual show.

Looking around at all the firepower, “It makes you wonder sometimes, are we just here to ‘outbooth’ each other?” Pieri said. But the “Best of E3” awards, given out by the gaming press after the show, are “hugely important” for sales, Pieri explained. That’s why companies spare no expense.

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Private movie theaters, theme park-sized installations, mazes of space-age conference rooms, balconies and walkways abutted futuristic spy vehicles and fantasy creatures. But even cutting-edge game companies can be stodgy neighbors. Microsoft’s Xbox team filed a noise complaint against neighbors NCSoft, a Seoul, Korea-based company hosting a live band. The sounds of L.A.-based techno-band Mutaytor were drowning out Microsoft’s mod-style conference rooms. The band performed live shows every hour complete with fire-dancers, acrobats and thundering drums while giving away DVDs.

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Buena Vista Games, the Glendale-based video game arm of Walt Disney Co., launched one of the more daring projects at E3: a Desperate Housewives video game. As one of the only booths targeting female gamers, it’s unclear whether the legions of “Housewives” viewers will be converted to PC game players.

“I’m a huge fan of the TV show, and I figured, ‘Hey, I could do that on my PC,'” said Mary Schuyler, lead producer of the game.

Players get to move into Wisteria Lane as a new housewife, and will spend the game interacting with the existing housewives from the show. The studio is in contract talks with the show’s actresses for their voiceovers in the game the stars’ images are already locked up. The game will be about uncovering secrets and scandals, much like the show itself. Players will first pick their character’s clothes, home d & #233;cor and personality.

The game will be based on a 12-episode storyline, with activities and tasks being offered in exchange for more secrets and twists to the plot.

Unlike every other video game at E3, there will be no points to earn. The “competitive nature” of the game is decidedly more female, according to its creators. “It’s about being a part of the story,” Schuyler said. “You can use information to blackmail other characters or help them. I guess that’s sort of like points.” Buena Vista said the game is due out in the fall.

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Calabasas-based Emergent Game Technologies Inc., which makes software for game developers (called middleware), held court in a remote conference room. “To be here and have a presence is really important for us,” said Chief Executive Geoffrey Selzer. “We just have to be where everybody in the industry is, to see what they’re doing.” He meant what the developers are doing. Emergent creates electronic engines that take an artist’s design of a character and render it into a three-dimensional moving creature. With no fancy display or high-definition surround-sound, it’s a wonder the company was able to get any attention.

“I don’t care if we have a consumer presence at all those are not our customers,” Selzer said. It also makes software that allows networks of computers to communicate like “enterprise software” for the video game world. The venture-backed company signed a deal at the show with Canadian powerhouse BioWare Studios, to license Emergent’s game engines for its upcoming titles. Terms of the deal were not disclosed.

Beyond the firepower, it was after all, a trade show.