• Reuters, Tuesday, July 24, 2007 11:01 AM

New year-over-year video game figures revealed that the industry continues to follow a cycle of rejuvenation every five years as hardware makers introduce new consoles and software. Industry sales, boosted by the introduction of two new systems from Sony and Nintendo, rose 31% from last June, according to researcher NPD Group. Sales were expected to climb, but some analysts were concerned about the demand for consoles, given the resurgence of PC software and the surging popularity online gaming.

However, console sales drove the industry's year-to-year rise, which is expected to continue as game makers unveil new software and online offerings. Said NPD analyst Anita Frazier: "The industry continues to realize substantial gains, month after month, and on all fronts it's great growth." June sales of $1.1 billion were up 35% from May.

Unsurprisingly, Nintendo's modestly-priced Wii took the highest share, selling 381,000 units in June, followed by Microsoft's Xbox 360, 198,400, and Sony's PS3, 98,500. GigaOM says Sony, still a distant third, is poised to have a much better year than Microsoft, especially after the software giant announced it would have to extend its Xbox 360 warranty (at a cost of nearly $2 billion), due to a significant number of defects. According to the report, one in three Xbox's were found to be defective.

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