Video game moguls cheered. But just about every other part of the industry cried foul last week when organizers of the annual Electronic Entertainment Expo (E3) decided to shrink next years confab.

An executive for Electronic Arts, the world’s biggest video game publisher, said his company was completely behind the decision, which he estimated would result in dollar savings in the “multiple millions next year.” Gaming platform makers Microsoft and Sony also support E3’s makeover into a more “intimate” and productive affair.

The new plan from the show’s organizer, the Entertainment Software Association (ESA), aims to pare E3 down to 5,000 attendees from the 60,000 or so that mobbed prior shows. That threatens to cut out smaller game publishers — not to mention the show’s “booth babes.”

Hardcore gaming “fanboys” are in a tizzy. Below is a snippet heard around the net:

– “So here we go, the large companies that care nothing about games get to consolidate their power over the industry, meanwhile the small companies get **** over again,” writes “lordpickle” on GameSpot.com.

– “This has sort of caught us by surprise,” said Christopher Heywood, a spokesman for LA Inc., the city’s convention and visitor bureau. E3 has called Los Angeles home for ten of its 12 years of life. It was the city’s biggest annual convention, packing an annual economic impact of about $19 million.

– One poster on Joystiq, “BlackYoshi,” said the move would likely banish the blogs and fanzines from the show in favor of the biggger site like IGN.com, GameSpot and 1Up.com.

– And what of the fate of scantily clad Booth Babes, the underemployed Hollywood actresses and models who had counted on E3 for a solid week of work? “Who will be sending them to college now?” Petrol123 worried on GameSpot.