• by Shankar Gupta , January 19, 2006

Sales of video game console titles last year decreased 12 percent from 2004, according to a report released Tuesday by the NPD Group.

Much of that decline appears to be due to a few key factors--the scarcity of Xbox 360s, the lack of major blockbuster titles, and sequel fatigue, said GameSpot Director of Industry Products Josh Larson. "One [factor] that everybody points to is the Xbox 360s. There just weren't enough of them," he said. "And there was a certain level of fatigue with the sequels that were out there. Some of these perennial games--games that come out every year--they just didn't make up for the fact that you didn't have any of these monster titles you did in 2004."

Despite the slide in console game sales, overall retail sales of games, hardware, and accessories last year increased by 6 percent to $10.5 billion, from $9.9 billion in 2004. The surge was led by a drastic increase in interest in mobile; portable games, hardware, and accessories increased by 96 percent, 42 percent, and 88 percent respectively over their 2004 levels, totaling $1.4 billion in 2005. "The portable market is really exciting--it's one of the real success stories of 2005," said Larson. "Portable continues to be exciting for 2006. Both the DS and PSP are about a year old, give or take, so I think those continue to be more important going forward."

Despite lackluster numbers for consoles in 2005, Larson said the industry would likely see an upswing after the new generation of consoles--the Xbox 360, the Playstation 3, and the Nintendo Revolution begin to compete for console gamers' attentions. "We're definitely in transition from one cycle to the next, to the next generation," he said. "You're kind of peeking around the corner with the new boxes coming out, and not as excited maybe with what's happening on the systems you already own."