Analyst: Retail Game Sales Will Be Down 26 Percent in 2012

Packaged goods sales in the United States will drop 26 percent in 2012, according to analyst Doug Creutz of Cowen & Company. Creutz says that double digit declines in the sale of video games at retail are likely to continue all the way to the end of 2012 due to the tail end of the life cycle for the PS3 and Xbox 360 console, as well as the continued weakness related to the Nintendo Wii.

"We believe double digit year-on-year software declines are likely to continue through the remainder of the year due to continued Wii weakness and the waning 360/PS3 cycle, though we do expect the pace of declines to moderate somewhat in Q4 with the fall release slate, the launch of the Wii U, and relatively easier comps," he said. "We project that total US packaged good video game sales will decline 26% year-on-year in 2012."

He went on to say that AAA titles are not "dead" using EA's NCAA Football 13 as an indicator. He predicts retail sales of that game will be roughly the same as they were with last year's game.

"We believe this is an important contraindicator to the prevailing thesis that 'AAA is dead'; we believe that if demand for high-quality AAA games was truly on the wane, it would almost certainly show up in EA's annual sports titles."

Source: GII

"shopping trolleys" © 2012 italianestro / Shutterstock. All rights reserved, used with permission.

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  1. 0
    Atrayo says:

    Hi There,

    This is the first time I can ever recall that the big video console makers have pushed out the life cycle of their products. When all is said and done Nintendo, Microsoft, and Sony's consoles will be anywhere from 8 to 10 years old in common usage. The Video console makes live on the sales of their game software since the systems are closed systems. Not unlike the PC or Mobile consumer audiences that can far easily gain access to free game content. The freemium trend in this Great Recessionary period has pushed consumer discretionary downwards.

    Video Game makers and their online networks are venturing into broadcasting cable channels. Chasing new revenue outlets as the technology of their networks and machines are capable of utilizing them. As game sales drop for the video game consoles they're cousins in the PC and Mobile platforms will be getting by.

  2. 0
    DorthLous says:

    Contre-indication is French for counter indicated. It is used, among other things, like Mr. Tastix used it. Never read it in English like that, though.

  3. 0
    Mr.Tastix says:

    All I could find was the definition of "contraindication": "In medicine, a contraindication is a condition or factor that serves as a reason to withhold a certain medical treatment."

    So it's probably a typo, or they're just really, really stupid.

  4. 0
    Andrew Eisen says:

    "We believe this is an important contraindicator to the prevailing thesis that 'AAA is dead'…

    Contraindicatior?  I have to wonder if that's a GII typo or if Creutz just made up a word.


    Andrew Eisen

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