Videogame industry in biggest decline since 2000
by Stevie Smith - Jul 17 2009, 15:15
Is expensive hardware keeping consumers from spending? Image: Sony.
After months of sustained growth despite the pressures of recession, the videogame industry’s more recent downward tilt looks like becoming a full-on plummet, according to the latest market sales figures for the United States.
More pointedly, NPD Group performance numbers for the month of June have revealed a massive drop of 31 percent to $1.17 billion USD, which equates to the industry’s biggest drop since the year 2000.
Breaking the notable decline into separate categories for the month, NPD outlines that U.S. software sales dropped by 29 percent to $625.8 million USD, with hardware sales spiralling by a whopping 38 percent to $382.6 million USD.
And, rather than June’s poor performance being but a temporary blip for the videogame industry, NPD also notes that software and hardware sales are presently down by 12 percent for the year so far.
According to outspoken Wedbush Morgan analyst Michael Pachter, the industry’s slowing momentum is due to consumer unwillingness to invest in persistently expensive console hardware.
Moreover, while Microsoft has implemented several price cuts for its Xbox 360, market leader Nintendo has not yet altered the November 2006 launch price of its hugely popular Wii, and Sony continues to resist calls for a more competitively priced PlayStation 3 – which is the most expensive platform on the market.
Perhaps reflecting that outlook, the Nintendo Wii led the month in home console sales, with Microsoft’s Xbox 360 sitting in second and Sony’s PlayStation 3 bringing up the rear. Interestingly, however, only the Xbox 360 emerged with positive year-on-year growth.
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