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NPD: Video Games Sales Tripled in 2007

11 Mar, 2008 By: Erik Gruenwedel

Video games in 2007 evolved from the domain of hardcore gamers to widespread teen adoption, supplanting declining music CD sales and flat DVD revenues for home entertainment, according to a new NPD report.

Retail sales of games increased 41% among teens, while CD sales dropped 45%. Music purchases declined among all consumer groups, but especially among teens, who cited increased appeal of gaming, according to Port Washington, N.Y.-based The NPD Group.

Russ Crupnick, entertainment analyst with NPD, said the results underscore the effects digital distribution has on music retail and the interchangeability of games, DVD movies and music.

“It's easy to lose sight of the fact that all of these entertainment categories are interlaced with one another,” Crupnick said. “They are all separately vying for a larger share of consumers' leisure time and wallet share.”

The report concluded that hardcore gamers — aficionados who play daily or several times per week — spend a majority of their entertainment budget on non-games. About 58% of respondents said they bought a DVD — not game — over the past six months. About 46% said they purchased a CD and 43% purchased a game.

“We have this perception of hardcore gamers glued to their consoles … when in fact they are spending a lot of time with, and money on, music, movies and other pastimes,” Crupnick said.

He said manufacturers and retailers need to diversify their exposure to consumers at both traditional brick-and-mortar locales and online.

“Doing so, they stand a better chance of increasing their share of the time and money consumers choose to spend on their products,” Crupnick said.

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