Sunday, September 15, 2013

US Game Sales Show Signs of Turnaround - Wall Street Journal

The videogame industry showed some signs of life as August sales data signaled a reversal of more than a year of contracting sales at U.S. retail stores, just ahead of the planned launches of two new consoles later this year.

Sales of new videogame hardware, software and accessories at U.S. retail shops rose 1% to $521 million, according to data from market researcher NPD Group. The industry's swing came mostly from strong demand for console and PC games, whose sales increased 21% to $305 million.

"Excluding January 2013, which was up due to an extra reporting week versus January 2012, the last time overall retail video game sales (hardware, software, and accessories) were up year over year was October 2011," NPD analyst Liam Callahan said in a statement.

NPD also said videogames that were launched in August made up more than half of overall dollar sales, compared with 24% of sales they represented in August of last year. "Due to a greater percentage of sales stemming from newer games at full price and have higher priced collector's editions, overall software average pricing grew by 25%," Mr. Callahan added.

Electronic Arts Inc.'s popular football title, "Madden NFL 25," was the top selling console videogame following its Aug. 27 release. Deep Silver Volition's gang warfare title, "Saints Row IV," was the second-best selling title on consoles and PCs. Walt Disney Co.'s "Disney Infinity" title, which allows players to have real-world toys interact with the game, ranked third.

"Disney Infinity" in particular is the company's attempt to compete against Activision Blizzard's "Skylanders" series of games, which have proved so popular they now are one of the biggest contributors to that company's overall sales and profit. NPD said one in every three accessories sales it tracked in August was for an interactive gaming toy.

Videogame accessories, such as companion toys and gift cards that can be used to buy extra levels or story-lines for various titles, rose 7% to $136.7 million.

The upbeat sales data suggest the industry may well yet bounce back from dramatic sales contractions it has been fighting. Both Sony Corp. and Microsoft Corp. are releasing new videogame consoles in November, the PlayStation 4 and Xbox One respectively. Industry executives have said the new devices, and their accompanying titles, would help lift videogame spending, which has struggled since the recession.

But analyst opinions have been mixed, with some such as market researcher PwC estimating world-wide console videogame sales will grow just 4.2% this year, and 6.4% next year to $27.62 billion.

While those increases would represent improvement from the contraction PwC saw last year, it's nowhere near the 28% growth the industry saw in 2007, a year after the last of the most recent consoles were released.

New consoles will also likely reverse the steep drops in videogame hardware sales NPD has recorded, most recently down 40% to $90.8 million.

Write to Ian Sherr at ian.sherr@dowjones.com

A version of this article appeared September 13, 2013, on page B6 in the U.S. edition of The Wall Street Journal, with the headline: U.S. Game Sales Show Signs of Turnaround.

Source : http://online.wsj.com/article/SB10001424127887323846504579071703553251552.html