U.S. video game industry sales plunged in October, dropping 19 percent from a year earlier, and 16.4 percent from September, according to data released Thursday by the NPD Group.
But with the tremendous, record-breaking, out-of-the-gate performance of Activision's Call of Duty: Modern Warfare 2 and the coming holiday season, NPD is bullish on the industry's fortunes for November.
Still, the $1.07 billion in total sales turned in by the industry in October were paltry, compared with $1.32 billion in October 2008 and $1.28 billion in September 2009. NPD analyst Anita Frazier tried to soften the blow a little bit in her monthly report, noting that while sales were down precipitously in October, it was still the third-best October sales report turned in by the video game industry.
"The continued economic turmoil, and in particular the troubling unemployment rate, is undoubtedly impacting industry sales," Frazier wrote in a statement. "Our latest Economy Tracker indicated that although consumers' general opinion about the economy is improving, their outlook on their own personal situation is worsening. If consumers' personal outlook continues to erode, they could very well be much more conservative with their holiday shopping this year."
That last sentence is no doubt one of the most chilling group of words imaginable to the honchos at companies like Microsoft, Sony, Nintendo, Electronic Arts, Activision, and many others involved in putting video game hardware and software in consumers' hands, especially as their most important sales months of the year are now at hand.
As always, regardless of the monthly results, the big console makers each had some things to celebrate in the NPD numbers.
For Nintendo, which has seen sales of its once-high-flying Wii dip and perceptions that the console's days of seeming infallible may be over, the numbers had some hope: in October, the Wii took back first place among the consoles--respectively the Wii, Microsoft's Xbox 360, and Sony's PlayStation 3. In October, Nintendo moved 506,900 Wiis, beating out the PS3 (320,600) and the Xbox (249,700).
Sony was coming off the first month the PS3 won since being launched in the fall of 2006, but while the console was beaten out by the Wii, there must certainly be some measure of gratification in having the PS3 come out ahead of Microsoft's console offering.
"In October, we saw continued momentum [for the] PS3, with nearly 70 percent growth, when compared to last October," Peter Dille, Sony Computer Entertainment of America's senior vice president of marketing, said in a statement. It was "the only console to see any growth year over year."
NPD itself touted Microsoft's chief bragging point for October: "Across all categories, the Xbox 360 platform contributed the greatest portion of total industry sales, representing 27 percent of total industry sales for the month," Frazier wrote.
Yet despite the record-smashing first-day sales posted this week by Call of Duty: Modern Warfare 2, the video game industry as a whole is facing a very painful reality: If sales don't improve quickly, there will be layoffs, slashed budgets, canceled games, and more.
Electronic Arts, for example, announced this week that it is planning to lay off 1,500 people as part of a major restructuring--the company's latest--and as a way to stave off growing losses.
And while the industry may have hoped that console sales--especially with prices for next-generation hardware now at their lowest levels ever--would help it rebound, Frazier did not offer much hope.
"Year to date, the hardware category has experienced the sharpest decline in the industry, with unit sales down 10 percent compared to the same time period last year," Frazier wrote. "Recent price cuts helped spur a one- to two-month increase in unit sales, and this month's Wii sales reflect that boost, but the other platforms have not sustained the sales momentum [after] price reduction."
Not only is this Super Mario costume homemade and hilarious, the guy sure can boogie.
(Credit: Caroline McCarthy/CNET)Really, America? Can we talk?
You see, I received this press release from Experian Hitwise in my in-box about the most-searched-for Halloween costumes in the U.S., based on searches in the month ending October 24 that ended in "costume." And the ranking was led by "Michael Jackson costume" and "Balloon Boy costume." OK, so those are timely, albeit a little bit more than unimaginative.
But it doesn't stop there. Following that were "Tinkerbell," "Catwoman," and "Poison Ivy," indicating that most costume searches are either on behalf of women or men who really want to make a fool of themselves. Among the top costume searches beginning with the word "sexy" were "sexy sailor costume," "sexy nurse costume," "sexy witch costume," and "sexy Queen of Hearts costume." (What would Lewis Carroll think?) And high-ranking costume searches beginning with "adult" include "adult cat costume," "adult Snow White costume," and "adult Care Bear costume."
I don't care what you dress up as for Halloween. Have fun with it. But just think about it. Adult Care Bear costume. Really. It's a costume that's probably itchy and uncomfortable, unflattering, and will embarrass the heck out of your kids if you have any. Not to mention that there's no obvious relevance to current events or pop culture that would negate the creepiness factor, considering the last time I checked the Care Bears have been around since 1981. Whatever happened to cowboys and pirates and disgraced politicians? Hitwise stats have officially weirded me out.
More depressing figures: Compared with the same time period last year, Hitwise found a 97 percent jump in searches for "pet costumes" this year. Those poor dogs.
This is nothing more than a huge rumor at this point, but gaming-industry site Superannuation is reporting that it has found a resume posted by a video game animator claiming to have worked on an unannounced GoldenEye 007 game for the Nintendo Wii.
Remember this level in GoldenEye 007?
(Credit: Screenshot by GameSpot)According to the report, the animator worked for Eurocom Entertainment Software, a company that has worked on several versions of James Bond titles, including Quantum of Solace and James Bond 007: Nightfire, between July and September.
The job listing said the person worked on "GoldenEye 2010 (Wii)." According to Destructoid, which also viewed the resume, the job description read, "Animator on Activision's James Bond series for the Nintendo Wii assisting in: Key frame animation, the preparation and clean-up of motion capture data, prop animation, in-game cut-scene animation, scene layout, and camera animation."
The resume was eventually pulled down from the site from which Superannuation accessed it.
Since its release in 1997, the iconic GoldenEye 007 has been the subject of several rumors claiming that a follow-up was on the way. But after Microsoft acquired Rare, the game's developer, in 2002, and Activision acquired the James Bond game rights in 2006, several licensing roadblocks were erected, limiting the chances of such a release.
Neither Activision nor Nintendo immediately responded to request for comment.
Considering that Nintendo and Activision are mum on a possible GoldenEye release for the Wii, it might be safer to assume that those roadblocks are still in place. But that doesn't mean that there aren't discussions going on behind the scenes to pave the way for the GoldenEye release. At this point, we just don't know.
So, let's hear from you. Do you think that this is the smoking gun for which GoldenEye fans have been waiting? Will GoldenEye 007 come to the Wii next year? Let us know in the comments below.
Don Reisinger is a technology columnist who has written about everything from HDTVs to computers to Flowbee Haircut Systems. Don is a member of the CNET Blog Network, and posts at The Digital Home. He is not an employee of CNET. Disclosure.
You wouldn't know there's been a slowdown in consumer spending by looking at Amazon.com and Netflix.
Both companies have continued to grab customers at a record pace, leading to higher earnings and sales for their third quarters.
Net income for Amazon jumped 68 percent to $199 million, or 45 cents a share, in the quarter that ended September 30, compared with $118 million, or 27 cents a share, in the prior year's quarter.
Sales rose 28 percent to $5.45 billion versus $4.26 billion in 2008's third quarter, the company said Thursday.
Amazon's stock shot up $23.75, or 25 percent, to $117.29 in Friday trading.
Amazon's two-year stock chart.
(Credit: Yahoo Finance)Amazon attributed its earnings to several key factors.
Chief Financial Officer Tom Szkutak said Thursday in a conference call with reporters that consumers continue to spend at Amazon because of its low prices and large selection. The company noted that it had 98 million customer accounts by the end of the third quarter, 17 percent higher than a year ago.
Worldwide sales from books, CDs, DVDs, and other media grew 17 percent to $2.93 billion, while revenue for electronics and other general merchandise soared 44 percent to $2.36 billion.
Another solid driver for growth was the Amazon e-book reader, Kindle.
"Kindle has become the No. 1 bestselling item by both unit sales and dollars--not just in our electronics store but across all product categories on Amazon.com," Amazon CEO Jeff Bezos said in a statement. The company did not release specific sales figures for the Kindle.
Amazon managed to clobber analysts' expectations. J.P. Morgan had forecast earnings per share of 31 cents on sales of $5 billion. Broadpoint.Gleacher analyst Ben Schachter had been eyeing earnings per share of 33 cents and said that sales were 7 percent higher than he expected.
In a report, J.P. Morgan said Amazon's strong sales growth shows that the company is grabbing significant market share from other e-commerce players, such as eBay.
In his report, Schachter called the results "phenomenal." He noted that Amazon was able to keep its costs in check while gaining market share in virtually every product category. The analyst also said he was "shocked" to hear Bezos' statement that the Kindle has become the company's top-selling item.
For the current quarter, Amazon is looking for sales of $8.13 billion to $9.13 billion, 21 to 36 percent higher than last year's fourth quarter, and racing past analysts' estimates of $8.11 billion.
Collins Stewart analyst Sandeep Aggarwal said in a report that improving e-commerce trends and continued growth for the Kindle, among other factors, could make Amazon the fastest growing large-cap Internet stock.
Another beneficiary of solid customer growth, Netflix also surpassed analysts' expectations for the third quarter.
The company's earnings jumped 48 percent to $30.1 million, or 52 cents a share, versus $20.4 million, or 33 cents a share in the prior year's quarter. Sales grew 24 percent to $423.1 million, compared with $341.3 million in 2008's third quarter.
Overall, analysts had been expecting earnings of 46 cents per share on sales of $420 million.
Growth in subscribers was the key driver for Netflix in the third quarter. The company ended the quarter with around 11.11 million subscribers, a 28 percent jump from the 8.67 million subscribers at the end of 2008's third quarter. Of the current total, 98 percent, or 10.84 million, were paid subscribers, while the remaining 2 percent were free subscribers.
"Our business momentum is strong and our third quarter performance keeps us solidly on course for a record 2009," Netflix co-founder and Chief Executive Officer Reed Hastings, said in a statement.
Though most Netflix customers still prefer to get their movies by conventional mail, Internet streaming has gradually taken off. In the third quarter, 42 percent of Netflix subscribers streamed at least 15 minutes of video, compared with only 22 percent in the prior year's quarter.
Customers can stream their Netflix picks not just through the PC but via gadgets like Microsoft's Xbox 360, which has helped attract new customers.
Now Netflix has reportedly struck a deal to add streaming to another device, which Hastings said is already in people's homes. Though the company has been mum about details, analysts believe it may be a video game console made by either Sony or Nintendo.
Netflix shares were up $4.58, or 9 percent, to $54.22 on Friday.
For the fourth quarter, the company believes customer growth and sales will be higher than anticipated three months ago. Netflix now expects to end the current quarter with 12 million to 12.3 million subscribers, up from the prior estimate of 11.6 million to 12 million. That would represent an additional 900,000 to 1.2 million customers.
Fourth-quarter sales are likely to reach $440 million to $446 million, up from the previous estimate of $431 million to $445 million.
However, the company forecasts a downturn in earnings from the third quarter, eyeing fourth-quarter net income of $21 million to $26 million, or 38 cents to 47 cents a share.
Expenses may be one factor affecting current earnings. Hastings said the company expects to spend more on marketing and licensing fees for Internet streaming. Netflix also believes its postal costs will continue to grow, surpassing $600 million next year and $700 million in 2011.
If you have been trying to tweet Michael Jackson over the last few weeks without even a squeak of success, might I sing you a song of hope?
A remarkably forward-thinking psychic has decided to hold a seance on Twitter. A "Tweance," if you will.
According to the Sun newspaper, Jayne Wallace, who claims to have been a psychic since she was (at least) 7 years old, will be available to every member of the world's tweeting population on October 30, between 10 a.m. and noon British Miserable Autumn Time (that's 3 a.m. to 5 a.m. PT).
Your rapt attention span and your rapid powers of cogitation will have noted that the date and time enjoy a chilling proximity to Halloween, the night when many dead people may rise from the grave and dance in unison to Michael Jackson's "Thriller."
You have the chance, on this suspiciously auspicious Halloween eve, of picking a deceased star and a question you would like to ask that person, then waiting for your reply from on high--or, who knows, perhaps even from the infernal below.
You will be excited to the point of cardiac incarceration to hear that the Tweance's Twitter page is already active. Be ready with a question the whole world will want answered.
Perhaps you would like to discover whether Guitar Hero 5 makes Kurt Cobain, well, turn over in his grave. Or whether Jeffrey Dahmer and Ted Bundy have philosophical disagreements.
Perhaps you might want a TwitPic submission of a smiling James Dean or a confirmation of your suspicion that Che Guevara is hanging with a rather conservative crowd these days.
Or you could be one of those strange people who wonders whether John Lennon and Florence Nightingale might occasionally make out when the afterlife authorities aren't looking.
Whatever your feelings about those who have famously left us, the Tweance is unquestionably your chance to confront your deepest curiosities.
Now that Halloween is reaching its socially networked nirvana, history may now enjoy a radical revision.
(Credit:
Smarty Pants)
Kids may gobble up junk food, but it seems they love playing with Nintendo devices even more.
Out of the 100 most loved brands for America's children and tweens, the Nintendo Wii and DS scored the first and second spots, according to a report by research firm Smarty Pants.
The survey "Young Love" found that even tempting snacks like Oreos and M&Ms trailed behind the Nintendo gear, taking the third and fifth spots in the list, respectively. Other techie items loved by 6- to 12-year-olds included the iPod at number 12, Sony's Playstation at 14, YouTube at 36, and Microsoft's Xbox at 42.
Kids participate in more than $500 billion in consumer spending each year, according to Smarty Pants, and their parents consider their favorites when buying everything from snacks to entertainment, both of which popped up heavily on the list.
"From Crayola to iPod, kids' most loved brands are familiar, iconic brands that delight kids and parents with variety, value, family-friendly content, and simple pleasures," Smarty Pants President Wynne Tyree said in a statement. "Interestingly, the top brands are not traditional 'for kids only' brands; in fact, many are not marketed directly to kids."
To compile the report, Smarty Pants questioned 4,700 American kids and their parents online over a period of nine months. Covered in the survey were more than 260 consumer brands across 20 different product categories.
The brands that kids liked most, said SmartyPants, were the ones that offered high-quality family time, age-appropriate content, parent-approved indulgence, variety/choice, "cool" accessibility, and chatter-worthy advertising.
The video game industry is poised to make a rebound, Wedbush Morgan Securities analyst Michael Pachter wrote in a note to clients on Thursday. The analyst also predicted that it will be Sony's PlayStation 3, and not the Nintendo Wii, that will lead console sales for the month, when NPD releases figures next week.
The PlayStation 3 Slim is helping spur console sales.
(Credit: Sony)"After six consecutive months of double-digit declines, we expect a return to double-digit sales growth (on video game software)," Pachter wrote to clients. "We forecast sales of $750 million, up 21 percent, compared to last year's $618 million."
It's a good sign that after months of decline, the video game industry is finally rebounding. That said, overall sales are still far behind 2008 figures.
PS3 victory?
But it's Pachter's next topic that might easily attract the most attention. According to the analyst, he estimates that September's NPD figures will show a "sell-through of 390,000 Wii hardware units (down 45 percent from last year), 350,000 Xbox 360 units (up 1 percent from last year), and 410,000 PS3 consoles (up 76 percent year-over-year), as the price cuts for all three consoles spurred demand."
Although Pachter said he thinks console sales will be "relatively flat for the balance of the year," he did say that the price cuts could "benefit the PS3 the most in coming months." Not only does Pachter believe Sony's console will outsell the Xbox 360, but he contends that it's possible that the PlayStation 3 will lead Xbox 360 sales for the rest of the year.
Another Xbox 360 price cut?
Pachter isn't convinced that the price cuts are over. He wrote to clients that "Microsoft has the ability to lower price yet again," but he cautioned that a more likely scenario would see the company offer a "more feature-packed Xbox 360 in early 2010 (likely with a 250GB hard drive) at the same $299 price point." It could cut the price of its console if "it begins to lose significant market share to Sony."
As interesting as they might be, Pachter's comments are purely speculation at this point. Look for the official sales figures to drop next week, when NPD makes them available.
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Don Reisinger is a technology columnist who has written about everything from HDTVs to computers to Flowbee Haircut Systems. Don is a member of the CNET Blog Network, and posts at The Digital Home. He is not an employee of CNET. Disclosure.
As market research firm NPD Group prepares to release sales data data for the U.S. game market next Thursday, other analysts have predicted a return to double-digit growth after six months of decline.
According to Edge Online, Wedbush Morgan Securities analyst Michael Pachter and Electronic Entertainment Design and Research's Jesse Divnich expect monthly software sales of $750 million (up 21 percent year over year) and $715 million (up 16 percent), respectively. And while these are still just estimates, it shows that consumers are still willing to spend on high-quality new games.
EEDAR's top 10 forecast:
Halo 3: ODST (360, Microsoft) - 1,800,000
Wii Sports Resort (Wii, Nintendo) - 500,000
The Beatles: Rock Band (Wii, EA) - 350,000
The Beatles: Rock Band (360, EA) - 325,000
Marvel: Ultimate Alliance 2 (360, Activision) - 300,000
Madden NFL 10 (360, EA) - 275,000
Batman: Arkham Asylum (360, Eidos) - 250,000
Batman: Arkham Asylum (PS3, Eidos) - 250,000
Guitar Hero 5 (360, Activision) - 250,000
Guitar Hero 5 (Wii, Activision) - 200,000
One interesting note on the top 10 list is that it contains only seven titles, which shows the importance of supporting multiple consoles.
A branching out of the Spore universe is in keeping with EA's desire to extend the game into the kind of open-ended brand The Sims has become.
(Credit: Daniel Terdiman/CNET)The pseudo-Darwinian life simulator Spore has been pegged by publisher Electronic Arts to evolve from video game to full-blown cinematic feature film.
We've known the film was a possibility since last year, but now we hear that Twentieth Century Fox is behind the CGI movie, and Variety reports that "Ice Age" director Chris Wedge is splicing its genes. Greg Erb and Jason Oremland, who wrote Disney's upcoming "The Princess and the Frog" and the Ben Stiller pic "The Return of King Doug" at Paramount, will reportedly write the script. What's unclear is exactly how Will Wright's schizophrenic sandbox game might translate to 90 minutes of family-friendly linear story-telling.
Read more of "Spore to evolve into major motion picture" at Crave UK.
(Credit:
Gizmodo)
Wow, as if we needed more incentive to not invest in the PSP Go, a new trend has arisen during the first day of Mini availability. The same games cost more on the PSP/PSP Go than they do on the iPhone/iPod Touch.
Examples:
(Credit:
Gizmodo)
Unfortunately, the system is set up to charge the consumer at maximum from the get-go. Games from the App Store start at free. PSP Minis--a new series of bite-size games--start at $5.
The fact of the matter is the iPhone gaming experience isn't all that great. Full-fledged PSP titles should cost more than tiny downloadable apps any day. But there's no good reason for gamers to pay a premium on PSP titles that are available for less on other platforms, just because they generally pay more for games.
There are multiple fingers to be pointed here. Sony, for not allowing free games, which would inspire some price competition. Sony again, for skimming who knows how much off the top of the price point. (In comparison, it's known that Apple takes 30 percent off of the iPhone App Store sales.) And the publishers, who decide to set their games at prices up to two or three times the cost of the iPhone version.
But the worst part? Not only is the content of overlapping titles generally no better than the iPhone; sometimes it's worse.
... Read more
