U.S. Game Sales Slip Marginally

Thanks to ZDNet/Reuters for their article stating that sales of game software for June dropped 9 percent in the U.S. compared to the previous year, "..reflecting fewer hit titles and a year-earlier tally that was helped by sharp price cuts on game consoles." Hardware sales also fell, and analyst Edward Williams suggests that "..the rate of sell-through suggests that a platform price cut this fall is increasingly likely as the hardware companies try to achieve targeted year-end installed bases." Elsewhere in the article, it's also suggested the hardware manufacturers may "..discount [hardware] more aggressively in order to boost sales of the more lucrative games."

Comments

What do they expect ?

[cpc]

The economy is bad, so people are a bit more concerned into investing a big amount of money into recreation. Why would video games be spared ?

Re:What do they expect ?

[wcb4]

no... Declining sales? Must be Napster (or Kazaa or the latest P2P craze), or some other form of internet piracy. It can't be declining quality or declining availability of funds

Are...

[setzman]

Game companies going to follow the tune of other industries (music/movie) and blame this on piracy on P2P networks?

Re:Are...

[ArmorFiend]

In my limited personal experience, game pirating is getting less and less prevalent. When I was a kid, with an Apple ][, I had copies of, say, 300 games. I had legit copies of, I think, 3 games.

Compare that to today, where the last 5-10 games I've played, I've also been legally licensed. I'm older. I'm waaay richer. And I actually care to be within the law.

So if the game companies are going to blame falling profits on rising piracy, I think they're inverting the historical trend.

Re:Are...

[NetDanzr]

"With the money lost to piracy last year, U.S. game publishers could have developed about 1,600 new high quality games."

Source: ESA (formerly IDSA).

Any other questions? ;)

A lot worse than 'marginally'

[RobotWisdom]

That 9% could have been almost pure profit, so losing it is a disaster. This is why a small boycott can also cause serious pain, eg the recent reaction against "Brand America" products like Coke and Nike, from people worldwide who detest Bush's insane arrogance.

Re:A lot worse than 'marginally'

[Torgo's Pizza]

Huh, wha? Who in the world rated this troll interesting? First, the article is talking about U.S. sales only and the reason that sales are down is because:
1) It's summer.
2) Not a lot of games come out during the summer.
3) The games that have come out have been disappointing (Enter the Matrix, Lara Croft)
4) The world is holding it's collective breath waiting for HL2 and Doom3 and the rest of the Christmas titles.

It doesn't take a fancy analyst and his crystal ball to figure that out.

Crash?

[AlexMax2742]

Now, I was born on the year that the game markets crashed, so I wasn't around to see the bottom fall out of the american video game market. But is a video game crash in the cards?

It won't be good to see the current contenders go under. But I WOULD like to be able to afford games now that I will be going to college, and I would also love for another Nintendo (Or maybe Nintendo all over again) to completely revolutionize the market again.

Am I stupid? Hey, look at my sig...

Yea Right...

[SoVeryWrong]

Wait until Fall/Winter, when a bunch of highly anticipated titles are going to float out.

Doom III (PC),
Half-Life 2 (PC),
Fable (X-Box),
FF:Crystal Chronicles (GC)

It is summer.... duh

[Anonymous Coward]

Summer is always slow for games. All the publishers wait for the Xmas season to launch the big titles. Just compare a June issue of Electronic Games Monthly to a October issue. It's about half the size and devoted almost entirely to previews.

This 'slow' period is part of the natural yearly cycle.

Re:It is summer.... duh

[PainKilleR-CE]

While Summer is always slow for games, the numbers they're comparing are for the same period last year. The difference is basically that there were more spring/late spring releases (which would carry sales into the summer as people are looking for games to fill the slow time) that people were willing to shell out money for last year than there are this year.

Of course, as another poster pointed out, there are a good number of big name titles slated for a fall release, so it's quite possible that some people are holding onto their money (or putting it on pre-orders) for those titles instead of spending now.

Re:It is summer.... duh

[johnkoer]

IIRC correctly June fell between May and July last year as well, so the Summer factor will have no affect. They are comparing June 2002 with June 2003.

Re:It is summer.... duh

[Anonymous Coward]

Seems to me that this kind of analysis is news for news sake. I would assume that games are a volatile market. Since the product dynamic (i.e. you aren't selling strawberries, ) you cannot hold individual months next to each other and get a fair comparison. Last June an entirely different crop of games was being released. A difference of 9% seems kind of negligable in this instance.

I could understand if you were comparing Slip-n-Slide sales year to year. It is a product whose nature doesn't change. Even though we are talking about games in the generic sense- you cannot divorce the generic 'gameness' from the content. Therefore the sales performance of previous quarters or years isn't such a clear indicator of the health of the market.

But thats just my boring opinion.

The perfect chance...

[srstoneb]

This is the video game industry's chance to get on the "blame everything on P2P" bandwagon, but instead they're talking about hit titles and price cuts. This is one step removed from accepting the blame in their own drop in revenue. Haven't they learned how to play the victim from the other entertainment sectors yet? :)

Dry Times

[Cap-America]

We're just in a bit of a Dry spell right now, Truthfully how many games came out in the last few months that were good?

I've only picked up 4 New games in the last few months, and I've actually have started to go out and buy games that I passed on earlier because nothing good has come out. We've been getting alot of crap lately.

Once the holiday season comes around and all the great Titles start coming out things will pick up again. We're just in a bit of a dry spell.

But lets just hope we're not seeing the slow decline in the game industry again.

Money, College, Friends

[Schezar]

The last PC game I purchased was Tribes 2. I only bought it because all of us bought it in order to play together.

The last console game I bought was Final Fantasy VI (III in the US) for the Super Nintendo.

Now, allow me to make three points:

1. Most "new" games just don't interest me. Sure, they look entertaining, but they're just not worth the money. I'd like to play them, but I have better things on which to spend my money. $40 buys a lot of pizza.

2. I'm in college. If any one of my friends buys a new game or system, I can play it for free pretty-much whenever I want. Between all of my friends, I've got access to everything but X-Box games. One purchase satisfies 20 people, so only one purchase is made, instead of 20.

3. Most newer games, while they may be entertaining, are usually only thus so the first time through. There's no replay-value. Ergo, when we all leave college and lose access to all those games, we have no desire to acquire them on our own.

Also, having lost access to free games, people tend to either give up on gaming altogether (just not worth the money) or stay a step behind the curve, picking them up at steep discounts in the bargain bin.

Zelda 2 was worth the $50 I paid for it back in the day, considering that I -still- play (and greatly enjoy) it from time to time.

[end_rant]

Re:Money, College, Friends

[MojoMonkey]

1. Most "new" games just don't interest me. Sure, they look entertaining, but they're just not worth the money. I'd like to play them, but I have better things on which to spend my money. $40 buys a lot of pizza.

I don't think this is the majority attitude. Could be wrong though.

2. I'm in college. If any one of my friends buys a new game or system, I can play it for free pretty-much whenever I want. Between all of my friends, I've got access to everything but X-Box games. One purchase satisfies 20 people, so only one purchase is made, instead of 20

This is no different than it's ever been. While I do call bullshit on your 20 to 1 ratio. Secondly, stop being a mooch.

3. Most newer games, while they may be entertaining, are usually only thus so the first time through. There's no replay-value. Ergo, when we all leave college and lose access to all those games, we have no desire to acquire them on our own.

This is the same point as 2. If this is truely you attitude, you'd never buy any of these games to begin with.

You points have been the same since I was playing the Atari 2600. They have no bearing on why current game sales have slipped.

Re:Money, College, Friends

[Anonymous Coward]

a college kid using the word 'ergo' in a sentence is analogous to a philosopher saying "yo what the fuck up g?!!!!"

so i guess what i'm trying to say is that your logic makes no sense....

ergo this post....

try to see the world outside of that box you call college...lol

Re:Money, College, Friends

[BTWR]

$40 buys a lot of pizza

Yeah, and like 13,000 calories (400 calories per slice, 8 slices per pie, $10 a pie 400*8*4 = 12,800). Get yourself a $40 dance dance revolution game or even ebay a nintendo power pad. Your arteries will thank you :)

Re:Money, College, Friends

[Schezar]

We play DDR at the local arcade at least three times a week. I was even bored enough to make my own metal dance pad.

I love that game ^_^

Re:Money, College, Friends

[Schezar]

I don't think this is the majority attitude. Could be wrong though.

I sure hope it isn't. But with the economy being the way it is, I'm sure people are re-evaluating where they spend their "entertainment dollar."

This is no different than it's ever been. While I do call bullshit on your 20 to 1 ratio. Secondly, stop being a mooch.

I didn't say it was different, and the 20-1 is just my group ;^) We're all pretty cheap, so overall we save a lot of money as a group. We all mooch.

Also, I attend RIT, a college full of gamers and geeks. Games are lent and traded (and pirated, but that's another argument altogether) freely. Why buy a game when you can borrow it for free a week after it comes out. Odds are you know -someone- who bought it.

I just mooch more (leach, if you prefer) because I care somewhat less about the games than everyone else. That, and I'm finding myself much more financially stable by not wasting my money on games. ;^) Always look out for #1.

This is the same point as 2. If this is truely you attitude, you'd never buy any of these games to begin with.

No, I probably wouldn't. It's the same with mp3s. I have no desire to spend money on music or games, but I'll take them for free if I can. If they're no longer free, I find another hobby.

Your points have been the same since I was playing the Atari 2600. They have no bearing on why current game sales have slipped.

Consider this. Despite all the new games we have, and all the new consoles we have, we (my friends and I) play the old NES more than anything else. There was something about those old games that made them fun and worth playing over and over again. When I left for college (and left my SNES with my brother), I went right about re-buying all my favorite games. Didn't give it a second thought (didn't know about emulation back then). Those games were worth the money, even a second time.

To me, most new games just aren't. As for other people, if they are repeatedly burned by less-than-fun games, they become less likely to buy more games in the future.

Re:Money, College, Friends

[Anonymous Coward]

we (my friends and I) play the old NES more than anything else

If I'm reading between the lines, you're really playing a NES emulator (i.e. NEStor) with, more than likely, illegal roms.

Re:Money, College, Friends

[Schezar]

If I'm reading between the lines, you're really playing a NES emulator (i.e. NEStor) with, more than likely, illegal roms.

We've got two NESs, an SNES, an Atari 7800, an N64, a Sega Genesis, an Intellivision II, a Japanese PS1, several PSXs, two PS2s, four Game Cubes, and countless GBAs between us. Not to mention a pile of games for all of them. We don't even need ROMs.

Re:Money, College, Friends

[Saige]

I sure hope it isn't. But with the economy being the way it is, I'm sure people are re-evaluating where they spend their "entertainment dollar."

Yes, they probably are - and if they're paying attention, they're realizing one good $30 game is a better entertainment purchase than, say, a family outing to the movie theatre which could cost just as much with popcorn and drinks and ticket prices. Better than a DVD in just about all cases. And so on.

I'd think games would be visible as a more attractive entertainment purchase, as there's bound to be more entertainment value in a game than other equivalent purchases.

I got over 20 hours of play time from Eternal Darkness - the first time through. My partner watched the entire thing, also, and she loved it. If we watched 20 hours of movies at the theatre, we'd be looking at $100 in cost, easily. The game sure didn't cost that.

Re:Money, College, Friends

[Anonymous Coward]

Well Scott, for a Biotech major from Horsham, PA you've got quite a collection there. Just keep your nose clean.

Re:Money, College, Friends

[Anonymous Coward]

Close, but no cigar. Scott graduated in May. This is that guy who runs the Anime club in Rochester. They know eachother I think.

Re:Money, College, Friends

[stuph]

40$ also buys a couple of lap dances.. no calories gained, but quite a few burned through "exercise"

Record warm weather to blame?

[jordanda]

I'm a pretty hard core gamer but I've hit a record low this month for game playing. Why? There has been nice weather in Seattle for a solid month for the first time in my life that I can remember. I picked up Knights of the Old Republic which has gushing reviews and totally deserves them IMO. Despite that I've had a real hard time staying inside to play it. For me this is just a one month anomoly.

Greatest Hits games

[NaugaHunter]

That just seems ill-informed. Bush gets his money from Big Oil and Texas. Boycotts of big name products like these might alter their bottom lines, but they are large enough to rebrand in countries where they have problems selling, or pull out all together. Pulling out might cost jobs, but quite possibly local ones, so it's hard to say who was actually hurt.

And before we spin into an off-topic arguement, I would be infavor of impeachment if our next choice (Cheney) wasn't more of a corporate man. Bush is a corporate tool that will hopefully be ousted. Unfortunately, the damage he's done both foreign and domestic may be more than Reagan/his father combined. (In fact, the Patriot Act would have legalized Nixon's activities.)

And that includes the economy, which is what has slowed Games sells. Oh, and the availability of $20 Greatest Hits games. No point in buying every game when it first comes out. Though whether this hurts or not has to be balanced against the dent it takes from used games. If I can get it new for $20, even $15 for Used is too much. And I'd rather buy two 'Greatest Hits' for $40 that I can look up and see have lots of fans, than one new game for 40-60 that has little fan base yet.

FUD control

[Torgo's Pizza]

Lots of comments being posted about the sky falling on the video game industry. Time to set things straight.

A nine percent drop is not that big a deal. Really. The reason being that June already is a slow month. The drop is due to several reasons (some I've already posted). The first (and biggest) is that we're right in the middle of a console development cycle, with the already existing consoles having been on the market for several years. Console sales also drive game sales. Secondly, June is right in the middle of crunch time for the AAA game titles. Everyone is holding off on buying games to get the huuuuge blockbuster games of Christmas. Thirdly, the games on the market aren't that good. Enter the Matrix is bad and Lara Croft isn't that great either.

Some people have mentioned the economy. Actually the game industry does better when the economy is bad. (More people buy games looking to escape their troubles.) If you look at past revenue figures, the gaming industry has always thrived during hard times. Just look at the past sales number of the past three years in the US. It's not piracy either. Operation Buccaneer and the recent closure of many pirate groups have put the finger in the dyke so to speak, but piracy is something the industry has lived with for twenty years. There hasn't been any discernable increase in piracy that would affect sales this much, especially when it comes to consoles.

If you really want something to gloom and doom about, I'd seriously pay attention to the SEC probes of gaming companies. That has some serious implications. Fact is come Christmas sales records will be broken and you'll forget that you ever saw this article.

Sort of bogus

[MBraynard]

It's like comparing this month's movie box office to last year's for the same month.

It's all about what was released. Last year's June had bigger/better releases than this month.

In general, though, the the trend for game buying is up and doesn't show any sign of stopping.

Bad month for games...

[alphaseven]

It probably doesn't help that the two biggest selling games last month (according to the article) Enter The Matrix and the new Tomb Raider, were two of the biggest dissapointments in video games in years.

Had those two games lived up to the hype instead of being merely average, I bet overall sales would have been a lot better.

Re:Bad month for games...

[scot4875]

Agreed. I find it utterly depressing that games like that sell so well.

Ultimately, you end up with a large number of people that think "hey, this is what a game is *supposed* to be like," and start a downward spiral of expectations and quality. (Hollywood, anyone?)

--Jeremy

Well, what do you expect when.....

[sycomonkey]

"The best-selling game in the month by units sold, analysts said, was Atari's mid-May release "Enter the Matrix'' for the PS2, followed by Eidos's "Tomb Raider: Angel of Darkness,'' also for PS2, data showed."

When games of that extreme craptitude are best-sellers, well, no wonder sales are down. Where the hell is Zelda and Ikaruga? Why is it the worst games are always the ones that sell the best?

Because the market has been saturated by non-gamers who wouldn't know a good game from a hole in the ground. If this was the early 80's there probably wouldn't be the crushed remains of 5 million E.T. 2600 carts buried in a New Mexico Landfill today.

Re:Well, what do you expect when.....

[amuro98]

Do not underestimate brand recognition, cross-marketting and other strategies that have nothing to do with the actual product being sold.

Lots of people know about Tomb Raider and The Matrix from the movies, and so will buy the game.

Also, I've only seen Ikaruga in one store near me - it's not even in all the other stores in that chain either. Hardcore shooters haven't been doing well in the gaming market since...well, the SNES really. Casual and non-gamers aren't likely to buy these sorts of titles - especially for full price.

As for Zelda, I've heard it called a kiddie game, due to the graphical style. I know it's not neccessarily a kiddie game, but you have to admit it DOES look a bit juvenile.

Having lots of casual and non-gamers in the market is a good thing though, since their numbers encourage the companies to release stuff like Ikaruga in the first place.

Part 2

[Omestes]

Maybe more people would purchase games if there were more new games. Yes there are tons of new games, but NEW games, meaning not bad sequals of decent games. I'm not really talking about DoomIII or HL2, since those have LARGE cult followings (hell, call it religion), and every PC gamer worth his salt is probably going to spring for one or the other, if they live up to expectations, and if said gamers have the upgrade cash. But PC games isn't really that big of a percentage of the overall gaming market, the fault lies in the consoles, as always.

How many NEW games are coming/came out this summer? Not with a 2, 3 ,4 or 5 appended to them, and not a clone of some other more successful game, I'm betting 2. I really doubt I'm underestimating this low number, might be three for all I know. Why would I want to buy a new game when I already OWN it, same characters, a little clunkier graphics, same story (for the most part). $50 is a lot of money to sink into a game I already own.

I guess this is the same reasoning that the average /.er applies to the RIAA fiasco, maybe if the company was more more original, people would spend money on it. And on the RIAAesque note, I doubt that P2P is a viable scapegoat, the average modern game is HUGE, and most require some tech savvy to copy. With the protections and formats they seriously limit copying to those who REALLY want to do it, and not the masses. The masses will just ignore crap products like "Tomb Raider: Lara gets boobs again!", Resident Evil googalplex, Final Fantasy DCLXVI-XXIII-II

Comparing Music to Gaming

[felonious]

Just as music has fewer mega hits the gaming industry will too. There is more music out there than ever before so spreading out funds for music is more pervasive. I think this applies to games. If you look at the amount of games coming out these days, on any platform, you'll notice there are 1000's of choices to chose from. If you own multiple consoles, a pc, a handheld, and have to purchase games for each platform with the same amount of money you used to only buy for one console then you'll see why there are less mega titles.

You didn't have a summer last year?

[Chuck Chunder]

Wow!

What's worth buying?

[Creepy]

Sorry to say it, but I haven't seen a game worth buying in the last 2-3 months. Since I generally don't play FPS because of motion sickness problems and don't much care for monthly fee games like MMORPGs (if I want a giant chat room, I play a free MUD, or more often, just chat gaming on IRC or here).

Everything that sounds even remotely promising has been reviewed as disappointment, so I haven't even bothered. I may pick up Medieval: Total War's Viking supplement if nothing shows up soon.