Madden NFL 12
September 9, 2011

Games Sales Suffer Significant Drop For August


Consumer reticence for non-essential spending, along with a dearth of high-profile game titles, has retail sales numbers for video games falling for the fourth consecutive month in August. This is the ninth such drop in the last 12 months, according to the market research firm NPD Group Inc.

NPD Group says in its monthly report that video game software sales – which refers to sales of the games themselves, sank 34 percent in August to $265 million, compared with sales of nearly $404 million in August of last year, reports the Associated Press (AP).

A primary factor in the decline is believed to be the delayed release of Madden NFL 12 from Electronic Arts. The title was available for sale on Aug. 30 and usually pulls in hundreds of millions of dollars with its usual release coinciding with football season. With its delay this year, sales won´t be counted until September.

The declining sales data do not include online services such as Xbox Live, PlayStation Network, Steam or other online offerings that are taking some of the stand-alone games and make up an increasingly large portion of the industry´s revenue. The numbers also do not include revenue from online social games, mobile games and subscription service offerings.

“The NPD numbers represent about two-thirds of the industry´s revenue” in North America, Michael Pachter, an analyst with Wedbush Securities, told the LA Times.

Pachter estimates that physical retail sales are likely to remain flat for the next few years while online and mobile games will grow from just over $9 billion this year, or 33 percent of the game market in the U.S. and Europe, to $16 billion, or more than 44% of the industry´s revenue, in 2013.

“A year ago, the tablets weren´t even a factor,” Pachter added. “Four years ago, who knew the iPhone would change the way we think about games? Things are changing rapidly.”


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