In a rare move, last week the NPD Group pushed back its September 2009 US game sales reports until today. This afternoon, it became clear why NPD wanted to double-check its figures. During the September reporting period, sales increased by a razor-thin margin, rising just $0.01 billion (that is, $10 million) from September 2008's $1.27 billion to $1.28 billion the year prior.
The increase broke six months of straight decline during which the game industry lost its "recession resistant" label. However, the fact that NPD's September 2009 reporting period was five weeks (August 30-October 3) compared to last September's four weeks caused the industry-research firm to say game sales were essentially flat.
"The industry managed a modest increase over September 2008 and generated the second best-selling September on record after 2007 when Halo 3 released and sold over 3 million copies that month," said NPD analyst Anita Frazier in a statement. "On a unit sales basis, the industry was flat. The increase in revenues is driven by a rise in average retail prices in all categories with the exception of console hardware in which the average retail price decreased 8 percent from last September."
Indeed, the price drops of all three consoles dragged hardware revenue down six percent to $472.28 million. The DS was the top-selling platform once again, moving 524,200 units during September. However, in second place was the PlayStation 3, boosted by the late-August introduction of the $300 120GB PlayStation Slim and closeout discounts of previous models. It sold 491,800 units; its best posting since it launched in November 2006.
Not far behind the PS3 was the Nintendo Wii, which sold 462,800 units, thanks in part to its new $200 price point. Nintendo reps were quick to alert the press that the number was a 67 percent increase over August, even though the price reduction only began during the final week of the reporting period.
In fourth with 352,600 units was the Xbox 360, the 120GB Elite model of which was also reduced to $300--with a further $50 rebate offered during the last few days of the reporting period. In fifth place was the pre-Go PSP with 190,400 units, followed by the PlayStation 2's 146,000 units.
"All three console manufacturers enjoyed the impact of lower prices on unit sales as the PS3, Wii, and Xbox 360 realized an increase over August of 87 percent, 33 percent, and 31 percent respectively, on an average sales per week basis (keeping in mind September was a five-week month compared to four weeks in August)," said Frazier.
She continued, "Compared to last September, the PS3 was the big winner, more than doubling last year's sales. This portrays a very strong consumer reaction to the price decrease as August and September both realized a lift of more than 70 percent over the prior month. This is the first month that the PS3 has captured the top spot in console hardware sales."
On the software side, Microsoft's 360-exclusive Halo 3: ODST debuted by selling 1.52 million units in the US--more than half its global 2.5 million-plus sales total. In second was the still-popular WiiMotion Plus pack-in Wii Sports Resort with 442,900 units, followed by the 360 edition of Madden NFL 10 with 289,600 units. Fourth place saw the debut of another well-reviewed newcomer, Mario & Luigi: Bowser's Inside Story with 258,100 units.
In the battle of the band games, MTV Games and Electronic Arts' The Beatles: Rock Band took the rhythm-game crown, selling 595,000 units while Activision's confidently promoted Guitar Hero 5 sold 499,000 units. The Xbox 360 edition of the Beatles: Rock Band came in fourth by selling 254,000 units, with the Wii edition ranking 10th with 208,600 units.
With just 132,000 units sold, the PS3 edition of The Beatles: Rock Band did not make the top 10. However, the Xbox 360 edition of Guitar Hero 5 did crack the chart, landing in ninth place with 210,800 units. However, the PS3 was better represented than usual on the top 10, taking sixth (Madden NFL 10) and eighth place (Batman: Arkham Asylum).
"We know all eyes are going to be on the Rock Band and Guitar Hero sales since the music/dance genre has been so closely followed by many this year," said Frazier. "Both titles captured a spot in the top 10 for the month, and at the item level across all platforms, The Beatles: Rock Band came in third behind Halo 3: ODST and Madden NFL 10 while Guitar Hero 5 came in fourth. The Beatles: Rock Band achieved this level of success with an average retail price premium of 130 percent to the average retail price for software overall. The sales of Rock Band and Guitar Hero led the music/dance genre to a 72 percent dollar sales increase over September 2008."
Other analysts were less upbeat about The Beatles' showing. "What's striking is the low overall dollar figure for the two games, which were out for almost the entire month," Wedbush Morgan's Michael Pachter told GameSpot. "The two combined fell short of $100 million, and I had forecast $210 million."
Fraizer, however, saw another silver lining in the month's figures. "Madden NFL 10 made up some ground this month," she said. "Although when launched in August, the game sold 19 percent fewer units than its predecessor a year prior, with a second month of sales in, that deficit has been reduced to 13 percent, which bodes very well for the title through the holiday season."
However, not all analysts share Fraizer's optimism. Electronic Entertainment Design and Research director of analyst services Jesse Divnich thinks there could be dark clouds on the horizon. He told GameSpot, "What we witnessed during the last week of September was a large drop-off in core hardware and software sales, indicating that the excitement over the PS3 and Xbox 360 hardware price cuts wore off quicker than anticipated."
Divnich continued, "In addition, the number of games purchased in conjunction with these hardware sales was lower than usual. This data suggests that most of the industry’s revenue for September was driven largely on the crutch of hardware price cuts. This is disappointing as it indicates that consumers are not being driven to purchase on key software titles--a significant driver for overall holiday performance. With this data now visible, it is most likely that October sales will be weaker than previously expected."
US VIDEO GAMES INDUSTRY - SEPTEMBER 2009 (Aug. 30-Oct. 3)
Hardware: $472.28 million (-6%)
Software: $649.32 million (+5%)
Accessories: $157.33 million (+2%)
Total Games: $1.28 billion (+1%)
TOP-SELLING HARDWARE - SEPTEMBER 2009
Nintendo DS: 524,200
PlayStation 3: 491,800
Xbox 360: 352,600
PlayStation 2: 146,000
TOP-SELLING SOFTWARE SKUs - SEPTEMBER 2009
Title / Publisher / Units**
1) Halo 3: ODST (360) / Microsoft / 1,520,000
2) Wii Sports Resort w/ Wii Motion Plus (Wii) / Nintendo / 442,900
3) Madden NFL 10 (360) / Electronic Arts / 289,600
4) Mario & Luigi: Bowser's Inside Story / Nintendo / 258,100
5) The Beatles: Rock Band (360) / MTV Games / 254,000
6) Madden NFL 10 (PS3) / Electronic Arts / 246,500
7) Marvel: Ultimate Alliance 2 (360) / Activision / 236,000
8) Batman: Arkham Asylum (PS3) / Square Enix (Eidos) / 212,500
9) Guitar Hero 5 (360) / Activision / 210,800
10) The Beatles: Rock Band (Wii) / MTV Games / 208,600
** = Figures include Collector's Editions and non-hardware bundles.