NPD June: Fourth Month of Video Game Sales Declines, Xbox 360 Resilient

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Microsoft's Xbox 360 and Nintendo's handheld DS were the only two systems to post sales increases in retail analyst NPD Group's otherwise disheartening June games industry sales report. Games hardware experienced the sharpest decline in June, plummeting 38% from $617m to $383m year-over-year, while video games software fell 29%, from $876m to $626m. Overall, retail games industry sales dropped 31%, from $1.7 to $1.2 billion, marking June as the worst period yet in a consecutive four-month year-over-year contraction.

"The first half of the year has been tough largely due to comparisons against a stellar first half performance last year," wrote NPD's Anita Frazier. "But still, this level of decline is certainly going to cause some pain and reflection in the industry."

Painful indeed, especially considering we were running headlines like "NPD: Nintendo Maintains Blistering Pace, Sony Doubles Hardware Sales," at this point last year.

More bad news: June 2009 saw the greatest year-over-year monthly decline since September 2000, when the industry dropped 41%.

Why the sudden sharp tumble over the cliff? Writes Frazier, "This is one of the first months where I think the impact of the economy is clearly reflected in the sales numbers." Another way to look at it: Absent last year's celebrity franchise titles, gamers are less inclined to drop disposable income on second or third stringers.

NPD says its latest gamer segmentation study shows more than four million new players in the market since last year. "The decline isn't due to less folks participating in the industry," writes Frazier. "Some of these are new retail consumers and some are playing online for free, and others are a mix of both."

Missing from NPD's equation? The ones playing online for money, which NPD doesn't track. No one (yet) knows how much that pot's cumulatively worth (or how much of this sudden retail decline is strictly economic, or just retail recession frugality belying what could very well be online sales growth). NPD claims its research into digital distribution "reveal it's not yet having enough impact on the console market to be an overly meaningful factor in the retail down-turn."

Other possible factors weighing on June's sales downturn as cited by NPD include a consumer base less willing to spend at the level of current hardware pricing, as well as consumers limiting discretionary spending for major titles or events like hardware price cuts.

The upside? There isn't one yet, but Frazier suggests that a strong second-half performance could bring sales into alignment, but she cautions that could all be for naught it more major titles like BioShock 2 bump to 2010 or later.


767k - Nintendo DS
362k - Wii
241k - Xbox 360
165k - PlayStation 3
164k - PSP
153k - PlayStation 2

The Xbox 360 was the only console to show unit sales growth over June 2008, and both the 360 and Nintendo DS were actually up in unit sales, year-over-year, for the first six months of 2009.

While Wii sales continue to drop, Frazier writes that the platform "is still realizing very strong sales month after month." It's still easily outpacing Microsoft and Sony, in other words, and selling competitively in terms of historical performance (i.e. where it stands, life-to-date, in relation to record-breakers like Sony's PlayStation and PlayStation 2).


420k - Prototype / Xbox 360
338k - UFC 2009: Undisputed / Xbox 360
289k - EA Sports Active Bundle / Wii
272k - Tiger Woods PGA Tour 10 / Wii
272k - Wii Fit / Wii
261k - Fight Night Round 4 / Xbox 360
210k - Fight Night Round 4 / PlayStation 3
202k - Mario Kart / Wii
199k - Red Faction: Guerrila / Xbox 360
193k - inFAMOUS / PlayStation 3

PS3 exclusive inFAMOUS (PCW Score: 90%) and multi-platformer Prototype (PCW Score: 90%) were each terrific games for entirely unique reasons, but the Xbox 360 version of the latter turned in double the PS3's roughly 180k sales of same (NPD reports combined console sales were roughly 600k). That makes intuitive (if not reliably scientific) sense when you consider the Xbox 360's U.S. install base is roughly twice the PS3's. Frazier adds that "While this is solid performance for new IP, it's a relatively modest sales figure for any game capturing the top spot for the month."

Tiger Woods PGA Tour 10 was either off to an auspicious or slightly disappointing start, spending on your vantage. It had a "great debut," according to NPD, when comparing its launch to prior bests PGA Tour 05 and 07. Considering that unlike its predecessors, PGA Tour 10 came bundled with the new Wii Motion Plus, it moved out of "Madden Month," the U.S. Open was in June, and the fact that the Wii has a massive install footprint, I'm actually a little surprised it didn't take the top sales spot for the month overall.

Speaking of the Wii Motion Plus, NPD reports it sold 169k units in its first month at retail, not counting ones bundled with Tiger Woods PGA Tour 10.

But wait, no Wii Play? Tribute time: "Interestingly, this is the first month since its launch at retail 29 months ago that Wii Play has not been featured in the top 10 list for the month," wrote Frazier. "That's an astonishing record for this industry."

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