Software sales tumbled 15 percent last month to $531.3 million, according to The NPD Group, which tracks retail sales of video games. A surge in hardware sales, spurred by temporary price cuts to the Xbox 360, salvaged the industry’s overall total, though it was still six percent lower than last year.
When Microsoft announced plans to bring the TV game show “1 vs. 100” to the gaming space two years ago, a lot of people rolled their eyes and groaned a little bit. Not me. I thought it was one of the company’s most interesting announcements of that particular E3.
The game was the centerpiece of an experiment called Xbox Live Primetime – a scheduled series of interactive games that represented the video game industry’s first serious foray into the turf dominated by TV. It was a hit, even setting a Guinness World Record for the most simultaneous contestants in a game show – 114,000. Now it’s dead.
Despite the fact that 2010 has been front-loaded with a plethora of critically acclaimed titles, this is turning out to be an awful year for the video game industry. And it’s likely to get even worse Thursday afternoon.
The NPD Group, which tracks video game retail sales, will release the June numbers roughly two hours after the market closes. Analysts are bracing for the worst – expecting a drop of anywhere from 8 to 15 percent from a year ago.
For the year ending June 30, sales of online products, such as movies, TV shows and downloadable game levels, were higher than revenue generated by subscription fees. Together, the company estimates that revenue for the Xbox Live service topped $1 billion.
The middle of the 2010 is not a good time for struggling gadgets. Both Microsoft and Plastic Logic have put in doubt the future of two highly touted devices – one that’s already on the market and one that hasn’t seen the light of day.
Both the Microsoft Kin phone and the Que ProReader device are on shaky ground. The Kin was launched just six weeks ago by the Redmond-based company and hoped to blend social networking with cell phones. The Que ProReader was (or is) an intriguing eReader introduced at CES this year that was specifically tailored to the business audience.
It has been a staple in the video game industry for generations now: roughly every five years, the major console manufacturers roll out new systems, packing graphics that are even more eye-popping and features we couldn’t have previously imagined. The core gaming world immediately goes crazy for early previews of next generation titles, scrutinizing every frame of released video. And the countdown begins for the next generation.
Not this time, though.
If the video game world were following its normal cycle, console makers would be revealing details of their next generation systems in less than two weeks. This cycle is anything but normal, though – and so at this year’s Electronic Entertainment Expo (E3), game makers will instead chart a new path.
Rather than introducing new systems, Microsoft and Sony will both introduce motion sensor controllers that are intended to both attract a new audience to the Xbox 360 and PlayStation 3 – and extend the lifespan of those systems by at least another three years. Nintendo, which is still seeing great success with the Wii, will focus instead on once again innovating the portable world.
Two of the most visible faces in Microsoft’s entertainment and devices division are leaving the company. Microsoft today announced the departure of president Robbie Bach and chief experience officer J Allard.
Bach is retiring after 22 years with the company effective this fall. He has headed the entertainment and devices division since its inception five years ago and is a regular presence at major Microsoft press events. Allard, the driving force behind the Xbox and Zune media player, is leaving, but will remain as an advisor to CEO Steve Ballmer.
Robbie Bach, a 22-year veteran of the company and president of the unit since its inception five years ago, will retire this fall. And J Allard, who was the powering force behind the Xbox video game console and Zune media player (and, until recently, was the driving force behind the company’s plans to make a PC tablet computer), will also depart the company.
If there’s one truth in the videogame world, it’s this: Never bet against the sales success of a new “Halo” or “Grand Theft Auto”. But as Microsoft prepares to launch “Halo: Reach” this fall, early evidence indicates people may not be betting heavily enough.
For the past three weeks, Microsoft has given fans of the game a taste of what the series’ next installment will be like. It turns out that player appetites were even more voracious than expected.