America Is Getting Video-Gamed Out

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May 12, 2004
George Anderson

By George Anderson

You couldn’t tell it by the amount of hours logged on televisions and computers each month in the typical suburban American home, but sales of video games are dropping — and
fast.

DFC Intelligence, which covers the interactive gaming industry, predicts sales of game software and hardware will drop 9 percent this year, making 2004 one of the worst in recent
years.

The only thing more depressing than DFC’s 2004 forecast turning out to be right would be if its 2005 projection was accurate also. The firm projects sales of software and hardware
to tail off 14 percent next year.

David Cole, an analyst with DFC Intelligence, told the Atlanta Journal-Constitution that the industry is in need of the next big thing. “The game industry sort of has
to reinvent itself every five years or so, but this is a time of great insecurity. It’s going to create some real business challenges … where the winners will be separated from
the losers.”

DFC expects the next big thing will come around, if not this year or next, by 2008. That year, DFC projects sales of interactive gaming software and hardware will surpass $33
billion.

Moderator’s Comment: What do you think are the factors behind the drop in interactive game software and hardware sales?
What will it take to reverse the decline?

Richard Ow, NPD’s senior video games analyst, explained the drop off in a recent report. “Most of the consumers in this industry have had their video game
hardware for some time now, so a slight decrease in sales is to be expected,” he wrote.

We can’t help wondering if the anti-obesity movement in the U.S. has gotten parents to force their kids out in the sunshine rather than indoors in front
of a monitor playing the latest role or first person shooter game.

George Anderson – Moderator

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1 Comment on "America Is Getting Video-Gamed Out"


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starner michael
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starner michael
15 years 3 months ago
If you look at what more independent commentators like Greg Costikyan have said about the video game industry, you’ll find that an increasingly vocal minority are of the opinion that video games as a medium of creativity have become stagnant. Development costs are matching and exceeding the budgets of Hollywood blockbusters and still rising exponentially, but in the long term sales are increasing in a linear fashion. With such high budgets, video game executives tend to try too hard to play it safe. There’s a bizarre tendency to be able to write off a failure of a derivative game as problems with the market, yet crucify the person who approved an original game that didn’t make it. This reluctance to take risks showed itself to be unfounded with Katamari Damacy, a quirky Japanese game that one of the managers at Namco’s U.S. offices said would never come to the U.S. because it was too weird. It did anyway, and became an instant and highly sought-after cult classic, and a sequel is on the way. And… Read more »
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