US Video Game Market Shrank 8 Percent in 2009

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Sales of video game hardware and software in the U.S. declined 8 percent in 2009 compared to the previous year, as consumers reined in spending during the tough economic conditions, NPD Group said Thursday.

The console market, which includes both living-room and handheld gaming devices, was worth US$19.7 billion in 2009, down from $21.4 billion in 2008. Despite the drop, 2009 ranked as the second-largest year for the industry, and the poorer annual sales hide strong year-end results that could indicate a better year ahead.

"The video game industry experienced its biggest sales month ever, besting last December by 4 percent," said Anita Frazier, an analyst with NPD, in a statement. "It wasn't enough, though, to compensate for the sales decline throughout the year, and so full-year sales came in 8 percent below last year's record-setting revenues."

The year saw several launches of high-profile software titles but the hardware market was steadier, with no major launches during 2009.

The console sector saw only the launch of a smaller and cheaper PlayStation 3, while in the portable market both Sony and Nintendo launched revised versions of their PlayStation Portable and DS devices. As a result, portable gaming hardware sales rose 6 percent on the year, but the console market overall contracted 13 percent.

"Hopefully, the big increase in the overall install base of hardware systems will bring good things for software sales in 2010, especially with the incredible line-up of content coming out early in the year," said Frazier.

In the software market, sales of console and portable titles both declined by 10 percent, and the PC gaming market saw software revenues drop 23 percent to $538 million. The total PC, console and handheld software market was down 11 percent in 2009, to $10.5 billion.

The biggest-selling game of the year was Activision's "Call of Duty: Modern Warfare 2" for the Xbox 360. The game was released in November and sold 5.8 million copies until the end of the year to make it the fourth-best-selling game of all time after only two months. The version for the PlayStation 3 sold an additional 2 million copies. It was ranked eighth in the annual sales chart and was the best-selling PS3 game of the year, according to NPD data.

Games for the Nintendo Wii took positions 2 through 7, giving the company six places on the year-end ranking, up from four last year. The top-selling Wii game of the year was "Wii Sports Resort," and total sales of the Wii titles in the top 10 stood at 20.8 million units, versus 19 million last year.

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