Has The Era Of Video Game Consoles Passed?
May 14, 2012

Has The Era Of Video Game Consoles Passed?

Is it time to begin mourning the end of an era? Console-based video game sales fell 42 percent in April of this year, with total industry sales falling to $630.4 million from $930.9 million a year ago, according to market researcher NPD Group.

An early Easter holiday and a relatively light game release schedule for the month may have contributed to the lower than expected sales numbers, but very strong sales numbers have not been seen for a while, writes Venture Beat´s Rob LeFebvre.

The industry as a whole has been on a downward spiral for a while. The estimated total consumer spending on games includes physical video and retail games, used games, game rentals, subscriptions, full-game digital downloads, social network games, downloadable content, and mobile games, not counting hardware, sales were $307.2 million, down 42 percent from $533.7 million a year ago.

The poor software sales were even lower than what a number of analyst firms predicted. Hardware accessories showed minor growth however, inching up 1 percent from last April, reports Lance Whitney for CNET.

Not everyone is down on the market however, “We expect a return to sales growth in 2012 due to new hardware introductions (PS Vita and Wii U) and many high-profile releases (likely including Take-Two´s Grand Theft Auto V),” analyst Michael Pachter said in report released recently.

“For some insight into digital purchasing of content, we can look at the performance of points and subscription cards which was up 75 percent in units over last April,” writes NPD Group´s Anita Frazier.

Despite the steep decline for video game software, Frazier noted that digital sales may have fared a bit better, as virtual currency and pre-paid time cards saw a distinct rise in sales year over year, writes Tom Curtis for Gamasutra.

Console game systems are becoming more expensive as makers bundle hardware accessories with the basic units and buyers are perhaps asking themselves if the latest-greatest is really worth the price?

“The average selling price for hardware increased over last April, with one of the drivers of that increase being the Star Wars Kinect 360 bundle, which included the Xbox 360 console and controller, a Kinect sensor, and Kinect Star Wars game,” explained Frazier,

Mobile games and intriguing titles played through Facebook and other social media are taking more of our attention away from the big-screen traditional titles many of us grew up with. Plus the fact that many of those are free or very inexpensive but still sophisticated, may be reason to give console game makers pause.

The NPD group also remains optimistic about ongoing sales for Nintendo´s 3DS hardware: “One thing to keep in mind is that the 3DS has outsold the DS by about one million units in their respective first 14 months in the market, and the DS went on to become the best-selling gaming hardware system ever,” Frazier said.

Looking ahead to next month, analyst firm PipperJaffray estimates that video game retail sales should begin to pick up, as May will see the launch of major titles like Blizzard´s Diablo III and Rockstar´s Max Payne 3.