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Game Biz Rev Tumbles 25%

11 Jun, 2009 By: Stephanie Prange

The video game business took a 23% revenue tumble in May compared to the same month last year, with software sales revenue dropping 17% and hardware falling 30%, according to figures from The NPD Group.

“The video games industry continues to struggle with difficult comparisons to last year, and this is the first month that industry sales have dipped below $1 billion since August 2007,” said NPD analyst Anita Frazier. “May is typically one of the lowest revenue-generating months in any given year for the industry in general.”

Frazier said unit sales declined less than did dollar sales. She said the dollar sales decline was exacerbated by a decline in average retail prices for nearly all categories.

On the next-gen hardware front, the low-priced Wii was once again the winner in May, with 289,500 units sold to Xbox 360’s 175,000 and PlayStation 3’s 131,000. Among handhelds the Nintendo DS sold 633,500 to the PSP’s 100,400. Last-generation victor PlayStation 2 still managed to sell 117,000 units in May.

“Every category declined versus a year ago, with the exception of portable hardware sales,” Frazier said. She added that portable hardware sales were bolstered by the strong sales of the Nintendo DS, including the DS Lite and the recently released DSi.

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