September was a very good month for the console game industry, which recorded US$1.36 billion in total sales in the U.S. for both video game hardware and software, according to the NPD Group.
The big winner for the month was Microsoft’s Xbox 360 exclusive, “Halo 3,” which sold 3.3 million units. The title perhaps also helped Microsoft move an additional 527,800 consoles. That made the Xbox 360 the No. 1 console in September and knocked the Nintendo Wii off of the top spot. That was a 91 percent increase over the 276,700 Xbox consoles sold in August.
With the holiday season right around the corner, those are nice numbers, said Mike Good, a Yankee Group analyst.
“You’re heading into the holiday selling season and you have a huge title in the marketplace — its going to help drive a lot of units. It’s that time of year.” Goodman told the E-Commerce Times.
“‘Halo’ was a blockbuster title, but we expected it to be a blockbuster,” he added.
Happy Not Quite Holidays
Microsoft was not the only game manufacturer to see a boost in September, however. The Wii sold 501,000 units in September, an increase in sales of just under 100,000 Wiis over the 403,600 the company sold in August.
Meanwhile, Sony’s PlayStation 3 (PS3) continued to struggle in fourth place behind the two current-generation consoles and the PS3’s own predecessor, the PlayStation 2 (PS2). Sales for the PS3 dropped from 130,600 in August to 119,400 last month.
On the software side, Nintendo scored the No. 2 and No. 3 titles with “Wii Play w/Remote” and “Legend of Zelda: Phantom Hourglass” for the portable DS system. Electronic Arts’ (EA) “Madden NFL ’08” for the PS2 fell from the No. 2 spot to No. 4. Rounding out the top five was EA’s “Skate,” which was released Sept. 14.
“Madden NFL ’08” for the 360, “Metroid Prime 3: Corruption” on the Wii, the Xbox 360’s “BioShock,” Nintendo’s “Brain Age 2: More Training in Minutes a Day” for the DS and “Heavenly Sword” on the PS3 were ranked sixth through 10th, respectively.
Overall, numbers for the gaming industry in September jumped 75 percent over those during the same month in 2007, going from $778.7 million to $1.36 billion. Of the latest total, hardware sales accounted for $544.85 million and software for $653.6 million. Console hardware sales rose by 188 percent from $145.5 million to $418.6 million over the previous September, with software picking up an additional 58 percent in sales, growing from $335.8 million to $550.5 million.
For the year to date, console hardware is up 118 percent over the same time period in 2006, with some $2.69 billion in sales for 2007 versus $1.24 billion the previous year.
“Halo [helped drive sales, but] the Wii posted some pretty impressive numbers as well if you look at what they did,” Michael Gartenberg, an analyst at JupiterResearch, told the E-Commerce Times. “You kind of had a combination of hardware and software driving things, and at the end of the day, that’s always going to be what it’s about. This is about the combination of hardware and software.”
Game makers will likely continue to see sales grow as the holiday season approaches and reaches its apex.
“If anything, we’re going to see things really begin to kick off as we get into the holiday season,” Gartenberg said. “This isn’t the biggest time for selling stuff. It’s when we get into the holidays that things get a little bit more interesting,”
“Halo 3” will continue to be a big seller through the season, according to Goodman.
“It’s a great title. Developers did a great job developing it, and lastly, marketing was very well executed. When you bring those things together you’ve created a perfect storm and that translates into retail sales,” he said.
Due to recent price cuts, the difference between the cost of a Wii the cost of the base models of the Xbox 360 and the PS3 is down to $100 to $150. It’s likely that everyone who wants a gaming system this holiday season will wind up with one, said Goodman.
“They may not have the console they went to the store to buy. Between the three there will be plenty supply, and the new price points [for the Xbox 360 and PS3] really begin to even the playing field,” he added.
“Everything is looking pretty good for the holiday season right now,” said Gartenberg. “There are a couple of wild cards out there like whether the Wii will be able to meet demand, but it’s looking like a really good holiday season in terms of the marketplace, in terms of consumers, in terms of hardware and in terms of software.”