When NPD releases October sales figures for the videogame biz later today, the industry will be looking closely to see how much the economic crisis has affected growth in the sector.
One thing, however, is already clear: The fall season isn’t bringing any blockbusters.
Fall is for videogames what summer is for movies — the time when the biggest titles come out and the most revenue flows in, as parents and spouses buy videogames as holiday gifts.
But as initial sales figures are released, it’s evident that the vidgame biz won’t have its “Dark Knight.” It’s more likely to have a few hits of the “Hancock” variety, as several games have sold very well without quite reaching blockbuster status.
Microsoft’s actioner “Gears of War 2,” for instance, sold more than 2 million units worldwide on its “opening weekend” Friday through Sunday, and many believe it could be the biggest vidgame of the season. Bethesda Softworks’ sci-fi role-playing game “Fallout 3,” potentially the biggest competitor for “Gears,” shipped some 4.7 million units worldwide in its first week, though actual sell-through figures weren’t available.
Other games with strong debuts include LucasArts’ “Star Wars: The Force Unleashed,” which sold more than 1.5 million units in its first week, and Ubisoft’s actioner “Far Cry 2,” which has sold more than 1 million units.
None of those titles come close to the perf of September’s “Halo 3,” which sold about 5 million units in its first week, or April’s “Grand Theft Auto IV,” which sold more than 6 million.
Compiling videogame sales data can be difficult since the only consistently reported figures come from the domestic top 10 chart released each month by NPD.
However, most vidgame publishers like to announce sales figures when they have a multimillion-unit hit on their hands. It’s often just as notable when they choose not to announce anything.
For instance, last year at this time, Activision was crowing that “Guitar Hero III” had grossed more than $100 million in its first week on sale in North America, repping more than 1 million units. Publisher hasn’t released any figures for this year’s follow-up, “Guitar Hero: World Tour.” In a recent earnings call, execs would say only that demand for the full band kit, which includes drums and a microphone, is outstripping supply (though several Los Angeles-area retailers have units in stock), adding that they expect versions with only a guitar, or the game alone, to sell better after Thanksgiving.
Meanwhile, MTV hasn’t released any data for September’s “Rock Band 2,” though NPD reported that initial sales in the U.S. on the Xbox 360 alone were a decent 363,000 units. Since November ’07, the original “Rock Band” has sold more than 7 million units worldwide; indeed, Viacom recently had to pay developer Harmonix a bonus of more than $300 million.
With their $190 price point, “World Tour” and “Rock Band 2” may be especially vulnerable to the faltering economy, which has just started to impact the videogame biz. Publishers including Electronic Arts and THQ have recently laid off employees, and they have all reported in recent earnings calls that retailers are being more conservative with orders as foot traffic has decreased.
Analysts still expect NPD to report that October U.S. vidgame revenue is up more than 20% compared with last year and the biz will finish 2008 up around that much from 2007. Biggest driver of sales will continue to be Nintendo, which has not only managed to tap into the broader casual market but also offers cheaper games and, in its DS and Wii, some of the least expensive hardware. Even as the economy has softened, Wii units remain difficult to find.