U.S. Game Sales Down In January, Xbox 360 Sales Slow

According to information released to analysts on the NPD Group's game hardware and software statistics in North America, January 2006 had software sales down 5% compared to the previous year. Total sales reached $357 million, a somewhat disappointing result which continues a transitional slump for the game industry. On the hardware front, one particularly notable statistic was the Xbox 360's approximately 250,000 hardware units sold in January, bringing its North American total to around 850,000 units, following 2005 year-to-date sales of 600,000 units. Needless to say, the main constricting factor for Xbox 360 sales continues to be the poor supply of the console, rather than a lack of consumers to purchase it. In fact, Wedbush Morgan's note on the sales indicated that it does not believe U.S. supply will exceed 300,000 units per month in the near future, due to the initial worldwide launch and the forthcoming Asian and Australasian launches. Other hardware news continued to be of interest, with the DS versus PSP handheld battle continuing - according to online reports, the PSP sold around 180,000 units for January, compared to the DS' 160,000 units, a much closer battle than many were predicting at this time last year. However, Sony's PlayStation 2 was the biggest-selling hardware for the month, at close to 275,000 units. Elsewhere, it was revealed that just four games surpassed 100,000 units for the month, compared to eleven in January 2005. The top selling title on PlayStation 2 and Xbox was Star Wars Battlefront II, with Call Of Duty 2 continuing to dominate the Xbox 360 chart, and GTA: Liberty City Stories still atop the PSP sales chart, closely followed by Mario Kart for the Nintendo DS. Mario Party 7 was the top-selling GameCube title. Finally, in a research note, Wedbush Morgan's Michael Pachter put a grim face on the results, concluding: "We think that the decline in overall sales of current generation software in January indicates the continuation of a trend that will persist well into 2006, and we anticipate double-digit declines in overall console software sales for the first half of 2006. We expect current generation software sales to decline at a 30% rate, or higher, for the full year. We do not expect sales of next generation software offsetting the current generation software sales decline until the PS3 and Revolution are launched." [UPDATE - 10.59am, 02/13/06 - updated with extra detail on top titles.]