While the sale of video games dropped 21 percent in the third quarter in Japan, sales reported in the UK and the United States continued to grow despite the very visible economic woes. NPD Group, GfK Chart-Track Ltd. and Enterbrain Inc. all reported that video game sales grew by 15 percent in the third quarter and 8 percent in the United States. Overall, the sales of the three combined markets rose just 1 percent with Japan keeping the figure down.
“2007 was a banner year for the Japanese software market with the titles released in the third quarter of 2008 not being as highly anticipated as those released during the same time period in 2007,” said Ricky Tanimoto, a global marketing analyst at Enterbrain. “Also, software titles generally have stronger launch sales in Japan, which represent a large percentage of the total sales in Japan compared to the US and Britain.”
He said that overall video games sales in Japan will be largely unaffected by economic problems during the holiday season. “New portable hardware systems like Sony’s PSP-3000 and Nintendo’s DSi will prove to be driving market forces in Japan throughout the 2008 holiday season,” he said. The UK market is gearing up for its best-ever fourth quarter performance.
The top title in the U.S. during the quarter was Madden NFL 09 with 2.96 million unit sales, followed closely by Nintendo’s Wii Fit at 1.28 million units. Star Wars: The Force Unleashed came in at third place with 1.42 million sales.
Result for: fourth quarter
In a panel discussion Tuesday at the HD3 conference in Century City, industry figures with a stake in the Blu-ray Disc format raised concerns over how the economy will hit the Blu-ray format over the holidays. Now that the format war is over and a lot of money has been put into promoting Blu-ray through retailers, the format’s backers had hoped for a strong performance this holiday season.
“The economy is the biggest challenge, because there are just so many pieces to the Blu-ray puzzle that consumers face,” said Lori MacPherson, GM of domestic home-entertainment at Disney. “You need the high-definition television set, you need the player, you need the cables, you need the software…” MacPherson still believes Disney’s seasonal slew of new releases and catalog titles in the Blu-ray format will help move consumers towards the format.
“The economy is hitting everybody,” said Danny Kaye, executive vp research and tech strategy at Fox. “But we still look forward to a great fourth quarter.” There is good news on the horizon however for high-definition video equipment. “I know the economy is tough right now, but the manufacturers are really bringing down the price of their HDTV sets,” Paramount vp marketing Chris Saito said.
Blu-ray player prices are falling but not as fast as many consumers would like. The disc sales themselves also present a problem, since new DVDs retail for around $15, whereas Blu-ray releases go for around $25. “We’re all constantly looking at (disc) pricing,” Sony vp business development Rich Marty said. “What it amounts to is that we’ll wait until after the fourth quarter and see how it goes.”
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Result for: fourth quarter
Research firm Strategy Analytics reported on Friday that Samsung has become the largest mobile phone vendor in the United States based on third quarter results. Despite global economic woes, the mobile phone market in the United States actually grew 6.2% from the same quarter of 2007, adding up to 47.4 million handsets in the quarter. South Korean consumer electronics vendor Samsung nabbed the largest share of the market at 22.4%.
Following Samsung (but still behind Motorola) was its rival also from South Korea, LG Electronics, which commanded an impressive 20.5% share of the U.S. market during the third quarter. In the previous year, Motorola had the top spot in the market with a 32.7% share, which fell dramatically to 21.1% in the same period of this year.
Motorola has warned that its fourth quarter results will also miss expectations, and that its mobile phone business will continue to weaken during the first half of 2009. Nokia took 8.4% of the U.S. market during the quarter which was up from levels seen earlier this year. Regardless, Nokia sells more handsets than Samsung, Motorola and LG Electronics combined globally, with a staggering 38% global market share.
