With no new hit games released last month, January retail video game sales declined steeply in the United States, though the drop was far deeper than analysts expected.
New games sold at retail, across all consoles and computers, generated only $379.6 million between January 1 and 28. That's a 34 percent decline, which is more than double a conensus estimate from video game analysts at Wedbush and Sterne Agee of around 15 percent.
While the lack of new releases versus last year was a significant contributor to the decline (January of 2011 saw debuts that included Dead Space 2, Little Big Planet 2 and DC Universe Online), NPD analyst Anita Frasier says that consumers also weren't purchasing as many of the major holiday releases in January 2012 as they were in January 2011.
"As shoppers were not drawn to stores due to new launch activity, this potentially impacted additional software purchases made on impulse," she explained.
Software
As expected, the strongest performing software in January was left over from the holiday period. In fact, no January debuts managed to crack the software top ten chart.
Activision's Call of Duty: Modern Warfare 3 was the best selling game, followed by Ubisoft's Just Dance 3 and Bethesda's The Elder Scrolls V: Skyrim.
Software sales across all consoles and portables brought in $355.9 million, a 38 percent decline over January 2011. Retail PC games add another $23.7 million to that total.
Hardware
Microsoft's Xbox 360 was the top selling console for the sixth straight month. The 270,000 units it sold contributed to a total of $199.5 million in hardware-based revenues, a decline of 38 percent from the prior year.
Accessories
Accessory sales were down 18 percent from last year at $195.2 million, due to unfavorable comps vs. last year's Kinect surge, according to the NPD.
Toy accessories for Activision's Skylanders represented 22 percent of those sales.
Beyond New Retail
The NPD estimates that video game industry revenues outside of physical retail sales -- including used games, downloads, social game revenue, mobile, rentals and subscriptions -- would add another $350 to $400 million to the $750.6 million that combined retail sales brought in.
I really don't get why game publishers don't just offer two additional services to bolster their bottom lines: rentals and "refurbishing" used games. If you're so worried about losing money to used games and rentals, why not just play a part it in and take a cut? Imagine offering games kind of like OnLive does in that you can either rent a game for a month for $X or buy it outright for $Y? Meanwhile, for used games, offer a trade-in system where traded in purchased games net the customer a 10-20% or better discount on a new game purchase from the publisher (or group of publishers). That way, people who like to keep their games, carry on while the people who don't are still monetized and given the type of legal access to the games they want without resorting to piracy or used games bins in stores. Better yet, the used game can be refurbished and resold for maybe 20% less than retail or better and you're still making a margin while guaranteeing customers (who might not have bought the new retail version anyway) and improving customer relations (by not treating them as pirates or criminals).
Nintendo is looking good with Wii U coming out this year as this gen has been on the decline and these numbers show the decline is accelerating. Kinect gave it a temporary boost but MSFT and Sony cant get there next Gen out soon enough. Xmas 2012 hopefully nintendo can get a lot of Wii U supply as they could sell a ton, who is really looking to buy a ps3 or 360 come November this year.....
