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Video game sales suffer 19% drop in October

Game Over
Game sales drop for the seventh month this year. Credit: Mykl Roventine via Flickr.

Ouch! Sales of video games and consoles in the U.S. fell 19% in October compared with the same month last year, putting the industry on the path for a decline in 2009 sales over last year, NPD Group said this afternoon.

"The industry is on track to generate full-year revenues in the range of $20 billion to $21 billion in the U.S., which would put it just below last year's sales of $21.3 billion," said NPD analyst Anita Frazier.

As for the holiday season, which in past years is when game companies rack up as much as 40% of their sales, it seems people are becoming nervous as they watch the unemployment rate hit double digits. According to NPD's Economic Tracker survey, consumers' "personal outlook continues to erode."

If October is any indication, the industry may be headed for a grisly holiday. Console sales crashed 23% to $380.7 million, compared with last year's $497 million. Game software sales fell 18% to $572.7 million, down from $698.4 million a year earlier.

"You're seeing the effects of the recession," said Michael Pachter, an analyst with Wedbush Morgan Securities, who two weeks ago predicted that U.S. game sales would be down 5% this year.

Sales of music-based games, such as Beatles: Rock Band and Guitar Hero 5, have lagged behind last year's numbers as the beat begins to fade for some, Pachter said.

With mainstream players, the heroes of last year's soaring sales, missing in action this year, guess who's riding to the industry's rescue? It's hard-core gamers. Yes, those insane enough to stand in line for hours to be the first to get their hands on games like Call of Duty: Modern Warfare 2.

The Activision title, a gritty combat game that's not for the faint of heart, took in $310 million during its first 24 hours of going on sale Tuesday in the U.S. and Britain. It's on track to bring in more than $1 billion in retail sales worldwide within a few months of release, according to a report by Lazard Capital Markets, putting it in the same entertainment blockbuster league as the movie "Titanic" and the album "Thriller."

October's results also confirm the reliability of avid gamers in tough times, with three of the top titles squarely in the hard-core category and another four spots going to sports titles generally purchased by loyal fans. To see the top 10 titles, click on the "continue reading" link below.

Top 10 U.S. Video Games for October 2009

  1. Uncharted 2: Among Thieves (PlayStation 3) 537,000 units sold
  2. Wii Fit Plus (Wii) 441,000
  3. Borderlands (Xbox 360) 418,000
  4. Wii Sports Resort (Wii) 314,000
  5. NBA 2K10 (Xbox 360) 311,000
  6. Halo 3: ODST (Xbox 360) 271,000
  7. NBA 2K10 (PS3) 213,000
  8. Forza Motorsports 3 (Xbox 360) 175,000
  9. Kingdom Hearts 358/2 Days (Nintendo DS) 169,000
  10. FIFA Soccer 10 (Xbox 360) 156,000

Source: NPD Group.

-- Alex Pham

Follow my random thoughts on games, gear and technology on Twitter @AlexPham.

 
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