• Associated Press, Friday, January 18, 2008 10:45 AM

Video games had a monster year in 2007, according to annual sales figures from NPD Group, with retail sales $17.94 billion thanks to high-demand for games like "Halo 3" and next generation consoles like the Nintendo Wii. Video game sales grew 43 percent, up from 12.53 billion in 2006. In December alone, Americans spent $4.82 billion on games, up 28 percent from a year earlier and 83 percent from November.

Breaking down the numbers, hardware sales jumped 54 percent to $7.04 billion in 2007, while software sales grew 34 percent to $8.64 billion. "The industry has become much more generally accepted as a mainstream form of entertainment, and that sets it up well for future expansion," NPD analyst Anita Frazier told the AP.

As expected, Nintendo dominated hardware sales in 2007. It's portable DS game system was the best-selling console with 8.5 million units sold, 2.5 million of which came in December. The Wii, in high-demand but short supply all year, sold 6.3 million units, with 1.4 million in December. Nintendo said it expects to sell even more Wiis this year, having raised production to 1.8 million units per month. The Xbox 360 sold 4.6 million units in 2007, with 1.3 million in December, thanks largely to the highly anticipated release of "Halo 3."

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