Video Game Industry Proves to Be Recession-Proof
As someone who owns eight different video game consoles and spends as much as four hours a day "gaming," Rumen is all but a certified expert on today's video game market. Rumen knows something that no Wall Street analyst does - how today's video game audience thinks. He knows what games are on the cutting edge, and more importantly, what games and consoles are most playable and popular among his peers.]
Despite all of the uncertainty of 2008, video game sales have been booming.
U.S. sales of video game hardware, software, and accessories surged 36% in the first half of the year to $8.27 billion. That even outpaces the $6.1 billion grossed over the same period in 2007, which was a record year for the industry.
Indeed, the video game industry has acquired the reputation of being recession proof, and the statistics bear that out. In 2002, after the technology bubble burst, the Dow Jones Industrial Average dropped 22%. Meanwhile, video gaming revenue climbed 43%.
And after a banner year in 2007, in which industry sales soared 50% to an all-time high of $18.85 billion, 2008 - even with all of its misgivings - is shaping up to be a new industry standard. Worldwide revenue is expected to exceed $57 billion in 2008, up 35% from the 2007 record of $41.9 billion.
With 267 million video games sold, an average of nine games per second were carried out of retail stores across the country last year. But as remarkable as that is, video games are flying off the shelves even faster in 2008, with sales up 41% in the first half of the year.
As the world’s leading format of entertainment, the video game industry had global sales of $41.9 billion in 2007 - double the total sales of 2002, according to PricewaterhouseCoopers LLP. At this rate, global sales will hit $68.3 billion by 2012. That’s a 10.3% annual increase over the next four years.
The Video Game Cheat Sheet
Video games have come a long way from the days of Pac-Man, Donkey Kong, and Pong…
There are gun-toting shooter games like Call of Duty, Halo, and Grand Theft Auto. There are fantasy, or role-playing games (RPGs), like Spore and Final Fantasy, that allow players to reshape an imaginary world in their own image.
And now, with recent advances in motion and sensory technology, there are games like Guitar Hero, MarioKar, and Wii Fit, that allow players to become active participants in the games they play, and physically control the onscreen action.
Here’s a quick look at the games that have sold the most copies over the past 12 months, in order of sales to date. (Note that the sales figures are approximate, and that the release date is the first date the game was released globally.)
1. Call of Duty 4 for the PlayStation 3, Xbox 360, and PC (10 million copies sold-Released November 6, 2007)-Activision, now Activision Blizzard Inc. (ATVI)
2. Halo 3 for the Xbox 360 (8 million copies sold -Released September 25, 2007)-Microsoft Corp. (MSFT)
3. Grand Theft Auto 4 for the PlayStation 3, Xbox 360, and PC (6.5 million copies sold -Released April 29, 2008)-Take Two Interactive Software Inc. (TTWO)
4. Mario Kart Wii for the Wii (6.5 million copies sold -Released April 10, 2008)-Nintendo Co. Ltd. (NTDOY.PK)
5. Super Mario Galaxy for the Wii (6 million copies sold -Released November 1, 2007)-Nintendo
6. Super Smash Bros. Brawl for the Wii (5 million copies sold -Released January 31, 2008)-Nintendo
7. Wii Fit for the Wii (5 million copies sold -Release December 1, 2007 (in Japan, later elsewhere)-Nintendo
8. Metal Gear Solid 4 for the PlayStation 3 (3 million copies sold -Released June 12, 2008)-Konami Corp. (KNM)
These are the games that have proven most popular over the past year. It’s important to note that all except one, Wii Fit, are sequels to previous releases. This is important because it shows that gamers are most comfortable buying and playing updated releases of games they’ve enjoyed in the past.
Likewise, the newest installment of the popular John Madden NFL football series is a sure-fire seller every year.
http://seekingalpha.com/article/1085...ecession-proof
