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Another month of retail video game decline in the US
Another month of retail video game decline in the US
January 10, 2013 | By Frank Cifaldi

It was bad news as usual for the retail video game industry in the United States last month.

Analysts at the NPD Group say that retail sales across the video game industry were down 22% in December, from $4.1 billion in 2011 to $3.21 billion this time around.

As usual, software caused the biggest hit (dollar sales were down 27%), which analyst Liam Callahan attributes to fewer releases.

"A major culprit in the decline in retail sales in 2012 was the lack of new releases with 29% less SKUs across consoles, portables, and PCs," he said in a statement.

"However, the SKUs that were released generated 8% more units per SKU and 11% more dollars per SKU."

The top-selling debut title of the month was Ubisoft's Far Cry 3, which saw strong figures despite releasing in December rather than the traditional holiday window in November. In fact, the NPD says this is the second-highest December debut since the group started tracking sales in 1995. Activision's November release Call of Duty: Black Ops II was the overall best-selling title for the second month in a row.

Top 10 software chart

The top ten selling games in the country last month were as follows. Note that the NPD combines individual SKUs of the same title together when tallying its numbers.

1. Call of Duty: Black Ops II (360, PS3, Wii U, PC)
2. Just Dance 4 (Wii, 360, Wii U, PS3)
3. Halo 4 (360)
4. Assassin's Creed III (360, PS3, PC, Wii U)
5. Madden NFL 13 (360, PS3, Wii, PSV, Wii U)
6. Far Cry 3 (360, PS3, PC)
7. NBA 2K13 (360, PS3, Wii, Wii U, PSP, PC)
8. Skylanders Giants (Wii, 360, PS3, 3DS, Wii U)
9. New Super Mario Bros. 2 (3DS)
10. FIFA Soccer 13 (360, PS3, Wii, PSV, Wii U, 3DS, PSP)

By the Numbers

Video game hardware: $1.07B (-20%)
Video game software (console, handheld): $1.54B (-26%)
Video game software (console, handheld, and PC): $1.58B (-27%)
Video game accessories: $603M (-14%)
Total video game sales: $3.21B (-22%)

Estimated used game, rental and "other physical" sales: $217M
Estimated digital sales: $765M
Total estimated video game spend in US: $4.1B

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Dimitri Del Castillo
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Don't blame me. I spent a small fortune on the Steam holiday sale.

Michael Rooney
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"However, the SKUs that were released generated 8% more units per SKU and 11% more dollars per SKU."

That's kinda wild. Now I don't know whether to be worried or not ;)

Bob Philhower
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Sounds like releases dropped more than demand did.

Adam Rebika
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People bought less games because there were less games released. But more people bought said released games.

Matt Robb
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Again, retail-only data is a terrible way to analyze the overall industry. You need digital distribution and micro-transaction data as well.

Ashley Blacquiere
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This is not an analysis of the overall industry though - it's an analysis of video game retail sales.

Matt Robb
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That's fair, but they tend to try to identify industry-wide trends from this data, because the data from non-retail revenue streams isn't shared to the same degree.

Kristian Roberts
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@ Ashley -- now one might ask: "What it the point of measuring video games retail sales in isolation?" Unless, I own a retail games store, I would be hard pressed to come up with an answer.

@ Christian -- True, but that's a very vague description of digital sales. Does it actually include an estimate of in-game purchasing (e.g. smurf berries) and DLC (which EEDAR typically calculates separately) or does it (as I suspect) refer to the digital sales of console, PC and handheld games.

Regardless, any fulsome analysis of how the revenue models in the games industry are evolving should (I submit) include a more nuanced understanding of the sources various digital revenue.

Ashley Blacquiere
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@Kristian: Yes, valid point. We can't really say whether the industry is doing well or not based exclusively retail sales, but metrics for digital sales are notoriously difficult to obtain. Hence the line 'Estimated digital sales'. These numbers may (or may not) be valid representations of the current state of video game sales; nevertheless, the information is still pertinent.

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Are we going to get a breakdown in data for top games sold on each individual console. I would love to see What Wii U software sales look like alone.

Justin Sawchuk
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Brick and mortar shops will go the way of the dodo. Why bother when you buy it off steam cheaper, keep it forever without having to worry about losing the disc or having it get scratched.

Andrew Chen
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Well different customers value different things...some folks remain romanced by the prospect of handling physical media (and perhaps the figurines and body pillows that are offered with them) and some folks like that they can resell that game after they have finished with it.
Personally, I think DoDo is a bit too harsh of a case, but on the other hand I'm not going to be running out to buy up some Gamestop stock anytime soon (ever). How about "brick and mortar shops will go the way of the kagu"?

Jonathan Adams
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I'd like to see these numbers compared to the number of people whose gaming is done in Free-to-Play stuff. If someone is already quite happy playing a free MMO, why would they need to purchase more games?