Like many things, launch parties scale with the size of the release's budget. Launch parties are usually reserved for the release of something to the public, we don't usually hold parties for reaching internal milestones. The biggest launch (and therefore biggest party) is always the game itself, subsequent launches like expansion packs (once a year launches) are generally much smaller. Regular content update launches (3 months or less of work) usually don't warrant a party.
A small team or release might just be some catered food, drinks, maybe a keg of beer, and snacks/desserts. This is the kind of thing we'd get in the indie space, or for a mid-size MMO that launches an expansion pack. A huge team might rent out a venue and throw a lavish themed party with events, people in costume, fancy food, an open bar, and so on. The original SWTOR launch party, for example, featured a live lightsaber battle show at the venue performed by costumed actors (above). The Call of Duty teams throw [pretty expansive parties] for the hundreds of devs who work on the franchise with live music and performances by well-known musicians and performing artists at fancy venues whenever they launch a new game.
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