NPD: May 2008 Game Sales Herald Bumper Year

Grand Theft Auto IV sold well in May, but not well enough to conjure significant hardware sales for Sony and Microsoft, and Nintendo locked up the top two spots in hardware sales for the fourth month in a row. The really big news: The U.S. video games industry kicked out $6.6 billion the first five months of 2008, more than all of 1997's revenues. "The industry is on pace to achieve revenues in the $21-$23 billion range for 2008," reports NPD's Anita Frazier.

And the numbers...

Hardware

675k - Wii
453k - DS
209k - PlayStation 3
187k - Xbox 360
182k - PSP

- Hardware sales barely budged from last month. Nintendo's Wii sales dipped 5 percent, but the company maintains a considerable lead over Sony and Microsoft, beating both the 360 and PS3 numbers combined by a margin only 100k units short of 2 to 1. From where I'm sitting, that's pretty incredible. Even if those numbers start to dip for whatever reason down the road, Nintendo's now ahead of everyone in every major market, and with mega-franchises like Grand Theft Auto IV failing to even moderately change that, I see diminishing reason to put stock in claims that Sony or Microsoft are going to "eventually pull ahead" in the months and/or years to come.

- The DS's sales actually increased by about 8 percentage points, possibly on strong sales of its two Pokemon Mystery Dungeon games, but also (speculatively on my part) because of seasonal incentives and/or structural demands that kids spend more time on the go and less parked in front of a TV set.

- Microsoft and Sony's numbers were virtually flat from April, with Sony up a meager six points over Microsoft's negligible 1,000 unit drop. NPD's Anita Frazier says the continued success of GTA IV isn't translating into big hardware sales for either the PS3 or 360, but adds "there may yet be a lift in June due to gift-giving for Father's Day and Graduations." I think not. Since when have Father's Day gift givers ever spent $300-$400 on Dad en masse, except for those rare cases when the family gangs up and pools the cash? And again, with games in the hotseat these days, especially that particular game, I don't see parents spending big money on a video game system as a reward for completing whatever level of an education. The idea that gaming and "education" are opposing forces may be changing, but not enough to rock Microsoft and Sony's numbers in June.

Software

871k - Grand Theft Auto IV (360)
787k - Mario Kart (Wii)
688k - Wii Fit (Wii)
443k - Grand Theft Auto IV (PS3)
295k - Wii Play (Wii)
171k - Super Smash Bros. Brawl (Wii)
131k - Iron Man (PS2)
117k - Guitar Hero III (Wii)
107k - Pokemon MD: Explorers of Darkness (DS)
102k - Pokemon MD: Explorers of Time (DS)

- Microsoft nearly doubled Sony's GTA IV sales grab, which makes sense if you look at the roughly 2 to 1 install base in static terms (about 11.6 million U.S. 360s against 5 million PS3s), but it tells us relatively little about either system's growth potential. When a game as important and popular and media-saturated as Grand Theft Auto IV fails to drive either console up the elevator, it suggests gamers don't yet see enough of a difference between either system. Coupled with Nintendo's hardware and software spoils, it also suggests price is still the deciding factor when it comes to new system purchases.

- Nintendo absolutely dominated May, claiming 7 of the top 10 slots. Interestingly, while sales of GTA IV sales plummeted 53 and 56 percentage points from April to May for the 360 and PS3 versions respectively, Mario Kart for the Wii was only down 30 sales points, while Wii Play only dropped 18 points.

- According to NPD's Frazier, "GTA IV has now generated combined sales of 4.2 million units, making it the top-selling title of the year." I'm sure both Microsoft and Sony are wishing they could've somehow locked that one up as exclusive even temporarily. Rockstar wins in the short term by capitalizing on the Sony and Microsoft's combined install base, but will unquestionably take longer to achieve Grand Theft Auto III for the PS2's 11.6 million sales crown.

- "A lot of folks are interested in the battle of the bands," says Frazier. "Year-to-date, Guitar Hero III has sold 2.5 million units compared to Rock Band's 1.3 million which lands them both in the top 10 titles for the year so far." Again, the lesson I'm taking away from Guitar Hero 3 holding off Rock Band is that Price Is King, no matter how cool your gear or compelling your game mechanic.

- I know what you're thinking. How the heck did Iron Man for the PS2 make the top 10? Multiply well over a hundred million unit install base by the popularity of that particular movie and the apparently highly forgiving standards of much of the gaming public (Iron Man the game on all platforms fared mediocrely with critics) and I wouldn't be surprised to see the PS2 version of The Incredible Hulk charting this month with that film in theaters today. Bad news for gamers who care about quality gaming, but great news for the "business first, quality and/or substance second" crowd.

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