June NPD video game industry sales predictions paint another gloomy picture

The NPD Group's monthly sales roundup for May marked the fourth consecutive month of 2009 in which the video game industry suffered a year-on-year sales decline. Such results were predicted by analysts Michael Pachter and Jesse Divnich, and both strongly believe the trend will continue into June. They differ on the reasons as to why they expect yet another month of slowing sales.

While EEDAR's Divnich points a finger at "next-generation home and portable software titles", Wedbush Morgan's Pachter goes straight after console hardware. Specifically, Pachter blames manufacturers in making a "strategic error" by testing the spending limits of consumers through maintaining their current suggested retail pricing for consoles. 

The analyst predicts the big three console giants will then be "forced to consider a price cut before year-end", perhaps sometime early October. Is this yet another plea for a PS3 price cut? Pachter certainly isn't the first industry personality to say it out loud.

Just how bad will June look? Pachter is predicting NPD software sales figures of $670 million, a 23 percent year-on-year sales decline from June 2008. Divnich is similarly expecting a 20 percent year-on-year sales decrease for last month. As with May, none of the individual software sales for June are likely to hit over one million units.  EEDAR in particular forsees the June top ten sofware sales to reach a combined total of 2.9 million units, compared to June 2008's 3.7 million+ unit sales.

Both analysts also believe console hardware sales to take the biggest nose dive; Divnich expects hardware unit sales for the next-generation systems to decrease by 33 percent over last year, while Pachter forsees an even larger 43 percent drop.

EEDAR's (Predicted) June 2009 Fun Facts

• Tiger Woods 2010 for the Wii will sell over 180,000 units.  Though the standalone release of the game sold better initially, subsequent weeks saw the scales tipping in favor of the bundle which included the Wii MotionPlus peripheral.
   
• Infamous is on track to outsell Prototype by around 35 percent on the PlayStation 3 despite "near identical game play and quality scores".  Lifetime sales for the former stand to eclipse the latter by as much as 50 percent due to the extended sales curve for platform exclusives.  However, Prototype's multiplatform release ensures that Activision's game may still outsell Infamous by over 90 percent once the dust and hype for both titles settle.
   
• THQ is expected to sell at least 3 million units of UFC 2009 Undisputed by the end of the publisher's current fiscal year next March 2010.  A current lack of competition in the MMA fighting game genre, television marketing for the title, and the "explosive increase" in UFC’s fan base this year will go a long ways in helping THQ's licensed brawler secure a "longer and healthier retail sales curve".