2010 Game Sales: It's Now Microsoft's Game to Lose

By  |  Friday, January 14, 2011 at 9:02 am

The NPD Group’s North American video game sales figures usually present a chance for publishers to spin the facts and crow about their accomplishments. But in the industry’s second consecutive year of decline, Microsoft’s the only company with bragging rights.

Consumers spent $6.2 billion on the Xbox 360 last year, more than any other game console according to Microsoft. And in December, Microsoft sold 1.86 million Xbox 360s, making it the only game console to grow year-over-year last month.

This is, of course, because of Kinect. Microsoft has shipped (not sold) 8 million of them, and now expects supply shortages for the Xbox 360 after dipping into January’s and February’s production runs to meet holiday demand.

Despite this success story, the video game business — excluding downloadable content, social games and online games — took in just $18.6 billion last year, compared to $19.7 billion in 2009 and $21.4 billion in 2008. It all seems kind of similar to the heady years of 2007 and 2008, when the entire industry was riding high on the back of Nintendo’s Wii. The difference now is that hardware sales for other consoles have tapered off, taking software sales with them and causing an overall decline.

I’ve said this before, but for better or worse, Kinect is the new Wii. It’s the mass appeal product that tops wishlists and leads to big sales, but it needs a special kind of software to keep people coming back. For the Wii, it was Wii Fit, Mario Kart, Wii Sports Resort and New Super Mario Bros. But Microsoft doesn’t have much on the calendar yet for 2011. If Kinect is going to buoy the games industry like the Wii did a few years back, I hope Microsoft has more than Fall 2010’s game lineup in mind.

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