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Nintendo's woes hurt video game industry

August 12, 2010 |  6:38 pm

NCAA Football 11

A tough time for Nintendo Co. is seen as the primary cause for the sales slump that is plaguing the video game industry.

For the month of July, sales of video games and consoles were off 1%, the fourth month in a row in which sales fell in the United States.

While sales of games for Sony Corp.’s PlayStation 3 and Microsoft Corp.’s Xbox 360 grew in July, sales for Nintendo Co.'s Wii games fell, according to NPD Group Inc., a market research firm that tracks the video game industry.

“Wii is responsible for all of the annual decline” in software sales, said Michael Pachter, an analyst with Wedbush Securities. “Wii owners are buying fewer games per capita than people who own the other two consoles.”

While video game sales are slumping, hardware sales are up. NPD Group reported a 12% jump in console sales in July while game sales fell 8%. Overall, players spent $846.5 million for consoles, games and game peripherals in July, down slightly from $850.6 million a year earlier.

Among those who weren't sweating in July were Microsoft and Sony. Microsoft hit a bull's-eye last month, selling 443,500 Xbox 360s, more than double the number it sold in July 2009.

“It’s the first time since September 2007, when Microsoft launched Halo 3, that the 360 was the top-selling hardware platform,” said Anita Frazier, NPD’s game analyst.

Sony also nearly doubled its PS3 sales to 214,500 in July, up from 121,800 a year earlier. And Nintendo sold 253,900 Wii consoles, up from 252,500.

Among game publishers, Electronic Arts Inc. scored a touchdown with its release of NCAA Football 11, which took the top spot in the chart. Also scoring was Microsoft, which took third place with Crackdown 2, a shooter game that lets players roam freely across a metropolis like a cop on steroids.

Starcraft IIThe top game title last month, however, was Starcraft II from Activision Blizzard Inc. The game was not included in the report, which is restricted to the console market, because it is played on computers.

Starcraft II sold 721,000 copies last month, more than the No. 1 console game, NCAA Football 11, which sold 692,000 copies.

When sales of console and PC games are combined, the overall game industry’s revenue increased 4% last month, Frazier said.

-- Alex Pham

Top photo: NCAA Football 11. Credit: Electronic Arts.

Bottom photo: Starcraft II. Credit: Activision Blizzard Inc.