Each week Dennis McCauley contributes The Political Game, a column on the collision of politics and video games:

Perception is reality, except when it isn't. And in the case of Manhunt 2, it's not as easy as you may think to pick out the winners and losers from this week's craziness.

Start with the Adults Only rating that the ESRB slapped on Manhunt 2. That may seem like a bad thing, but it's not. Just as new NFL Commissioner Roger Goodell recently cracked down on thug players for the good of the sport, the ESRB needed to prove to parents and politicians that the video game industry could police itself. By assigning an AO to Manhunt 2 ESRB president Patricia Vance certainly did just that. Surely new ESA top dog Mike Gallagher was in on the final decision as well.

In any case, Gallagher and Vance did what needed to be done. The bottom line is that the industry comes out smelling like a rose. And -- bonus cliché -- the proverbial line in the sand has now been drawn. While some content creators will understandably chafe at any sort of limits, the fact is that video games are not only big business but a form of entertainment which people invite into their homes. There needs to be a certain amount of public trust. Designers who can't deal with the realities of the market are welcome to go the Ryan Lambourn route.

GamePolitics is reporting that Take-Two, publisher of Rockstar's controversial Manhunt 2 (which was rejected by the UK's BBFC today) has confirmed that the game has received the retail kiss-of-death from the ESRB: an Adults Only rating. What does this mean for Take-Two? An AO rating ensures the title will not be carried in many mainstream family-friendly retail establishments (think Wal-Mart), reducing possible sales and making the path to profitability even more burdensome.

Take-Two can appeal the decision and dispute the AO rating, but something tells us this game has become a line in the sand that ratings boards, eager to prove their efficacy, won't cross. The ESRB's website hasn't been updated with the new rating just yet. More on this story is (surely) forthcoming.

Update: MTV News spoke with a representative for Rockstar who, when asked if the AO rating would result in a delay, replied, "That's the last thing we want, but it's too early to say."

Much like Michael W. Smith circa 1990, adult video games (read: sex-based) are looking for their place in the world. But the industry's lady lumps are faced with some significant humps to get over, first and foremost: Their games aren't sold in stores. But in speaking with GamesIndustry.biz, many publishers of adults-only titles seem to be optimistic about their future in a gaming retail landscape that is increasingly digitalized.

The piece (by Joystiq contributor Bonnie Ruberg) makes a compelling case for a day in the not-too-distant-future when sex games will be able to find a real foothold, citing publishers like Manifesto Games who are willing to take on adult titles and developers like Brad Abrams of VirtuallyJenna who are finding outside-the-box ways to promote their games. The article also notes the increasing size of the Sex and Videogames Conference, held annually -- in our pants. Actually, the venue hasn't been announced yet, so while it could be our pants, we'd bet on San Fransisco. Not that we'll get an invite now. Unfortunately, there's no mention of homemade sex games becoming more popular, which is bad for us, because we had a great joke about XXXNA. ... Actually, that was the whole joke, so we're fine.

[via GamePolitics]