Game sales fall sharply as recession bites

Los Angeles, CA – Hit by the recession, consumers are saying ‘game over’, with purchases of consoles down 30 percent on this time last year. Sales of games were down 17 percent.

According to a report from market researchers NPD Group, May was the first time since August 2007 that the games industry made less than $1 billion from consoles and games, with revenues of just $863.3 million – a drop of 23 percent on last May’s figure.

Sales of consoles fell sharply, dropping 30 percent from last May’s level to $302.5 million. Sales of the Nintendo Wii feel by more than half – possibly because it still sells at its original $250 price, and consumers are hoping for a price cut.  Xbox 360 sales dropped five percent, while Sony’s (SNE) PS3 sales plummeted 37 percent.

Games sales dropped to $448.9 million. One solid performer was UFC 2009 Undisputed, published by THQ. The fighting game, based on the popular Ultimate Fighting Championship license, sold more than a million copies. Electronic Arts sold 345,800 copies of EA Sports Active.

The fall in games sales is a little surprising, as received wisdom is that when times are hard people tend to turn to cheap entertainment at home. NPD says it thinks the sector will remain relatively resilient.