August 2010 console video game sales fell to their lowest level in four years, according to NPD Group. The belief that sales had begun to recover, based on numbers from late spring and early summer, has proved to be wrong.
U.S. video game sales dropped 10 percent to $1.6 billion compared with August of 2009, according to NPD Group.
One has to wonder whether mobile and online gaming is starting to displace some amount of demand for console games. It would be easy to blame the recession, which undoubtedly has had some effect. But the popularity of games in the Apple App Store, if any indication, suggests people now are spending more time with simpler games they can play on the go.
According to the NPD Group, 20 percent of the U.S. population ages six and older reports having played a game on a social network in the past three months. That suggests 56.8 million U.S. consumers were social gamers in the quarter.
About 35 percent of social network gamers say they are new to gaming, never having participated in any other type of gaming before they started playing games on social networks. Females and older age groups are more likely to be new gamers than other groups measured in the study.
Interestingly, despite the perception that social network gamers are primarily females, the study finds that social network gamers are fairly evenly divided between genders, at 47 percent male, and 53 percent female.
"Although 35 percent of social network gamers are new to gaming, it's clear that a lot of existing gamers have been drawn into the social network gaming arena as well," said Anita Frazier, Industry Analyst, The NPD Group. "This impacts both the time they spend with other types of gaming, as well as the amount of money they’re spending on gaming. As more players are drawn into these games, the entire games industry is going to feel, and have to adjust to, the impact."
While you can play these games for free, it is worth noting that 10 percent of social network gamers have spent real money playing these games and 11 percent indicate that they are likely to make a future purchase. Social network games are also impacting spending on other types of gaming activities as gamers report spending 20 percent less on gaming overall since they started playing social network games.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
