Music Game Mitigation

However, the situation is a bit more nuanced than those figures alone. For example, Guitar Hero: World Tour did not launch equally across all four platforms. The PlayStation 2 version of GH3 was just behind the Xbox 360 version in its first week of sales.

Yet the PlayStation 2 full band kit of Guitar Hero: World Tour did not ship to retailers until 13 November, well after the release of the other kits. Sales of that version will be included in November sales, to be reported during mid-December.

Moreover, Guitar Hero: World Tour is a bigger investment for consumers. The first week average sale prices for Guitar Hero III and World Tour were $82 and $122, respectively.

So while consumers have purchased far fewer units, they have paid roughly 50% more for that privilege.

Finally, October 2007 was not Guitar Hero III's strongest month – that was December 2007 when nearly 2.7 million copies were sold across the four platforms.

If sales accelerate in November and into December, then few will remember the weakness of the first month of sales.

For its part, Rock Band 2 on the Xbox 360 (originally launched in September) and PlayStation 3 (launched in October) is currently leading over its rival band game in terms of units sold. Sales on the lead platform, the Xbox 360, declined to around 120,000 units from a launch month total of 363,000.

The PS3 version of Rock Band 2 was just behind the Xbox 360 version in October with just under 119,000 units.

The Move To Platform

The key question now is why the music game market appears slower this year than last. The fact that Guitar Hero has been a top 10 property for 21 of the last 24 months suggests that brand fatigue has begun to set in.

In addition, a videogame consumer may well pass up a premium product like Guitar Hero: World Tour or Rock Band 2 and opt for a less expensive new game or several used games, especially as evidence builds that the economy is headed for a deeper recession.

Some consumers who would purchased a game bundled with a guitar or drums last year will simply purchase the standalone game this year. Consequently, Activision Blizzard and MTV/EA will realize significantly less revenue from those software-only customers.

The fact is that big retail launches will probably be less important for Activision Blizzard and MTV/EA going forward.

Instead, each company will probably focus on establishing a steady stream of content via console network services and growing a larger pool of consumers over a longer term. Like the DVD and Blu-Ray markets, the goal is to provide a platform on top of which other goods can be sold.