The video game business is still in a slump

Posted by David Konow

The video game business has endured a lot of ups and downs, and there often isn’t a gradual drop off in sales.

Recall back in the early eighties when Atari had it’s biggest year, then the bottom fell out shortly thereafter. Perhaps it’s a result of ADD you get from playing games that causes players to lose interest, but trying to track the market is definitely feels like being on a rollercoaster. 

In the fourth quarter of last year, gaming got a big boost from Halo 4 and Call of Duty Black Ops 2, but according to Variety, this hasn’t been enough to bring gaming back out of the doldrums. As Marc Graser writes, the gaming biz had “a rough month” in February, with sales declining 25%.
 
Variety also reports that the new big game launches haven’t helped bring things back, and software sales are also down by 27%. (Hardware sales are also down 36%.) Call of Duty Black Ops 2 was the #2 best selling game of last month, with Dead Space 3 coming in at number one.
 
As this report confirmed, new hardware releases didn’t help either, with Xbox 360 topping the sales charts, but the Wii U “continues to be a slow seller.” So could any new games help turn things around? The big daddy coming this year is GTA V, but will it be enough? 
 
As TheAustralian reports, “The US Market figures show the continuation of a trend away from conventional gaming platforms, with a pick-up in gaming on mobile devices.” One analyst told IGN, “Thought there was the same number of February launches that landed in the top ten ranking this year as there were last February, collectively, February 2013 new launches performed worse than last year with unit sales down 30%.”
 
The analyst continued, “Looking at hardware sales on an average per week basis, all platforms showed an increase from January into February. Specifically, new platforms like the Wii U and PS Vita demonstrated some momentum from the typical January hardware lull with increases of over 40% and 30% respectively.” 
 
So maybe things will turn around this year, maybe they won’t. It’s very tough to predict with the volatility of the market. We feel GTA V will be the big one to watch, and if it doesn’t sell, or help improve the market, then the business could really be in trouble. We’ll certainly be following events closely, stay tuned…