Ever vocal industry analyst Michael Pachter has declared that 2009 has been “a horrible year” for gaming companies. He points out that PC gaming was particularly badly hit, with sales in October down 38 percent in comparison to October 2008 in the US.
Not only did the PC suffer in October, but console software sales were down 18 percent from the same month last year.
It is not only October which failed to match its same period in 2008. Most months this year have shown a double digit percentile decline in software sales, and PC game sales have been particularly underwhelming.
“2009 continues to be a horrible year for video game publishers. Although a small rebound to sales growth in September sent a signal that the console cycle is not quite dead yet, investor confidence remained shaken when October sales again reverted to a year-over year double-digit decline.” Said Pachter
The decline in software sales throughout 2009 bears an ominous omen for the gaming industry. Where traditionally the industry has attracted investors based on the perception that it offered potential growth, poor performance in 2009 has many investors believing that “the industry is in a state of secular decline.”
While software sales are down, hardware sales are expected to either remain flat or increase going into the Chirstmas period. The Xbox 360 and Wii are expected to match last year’s holiday sales, while it is anticipated that the PS3 will show significant growth.
While more hardware is being bought, the follow up support for games has been lacking. This may indicate that game buyers are simply being far more conservative than in the past, or that game prices may be strangling sales potential. Piracy is also blamed for the drop in sales, although it is debatable how much it actually effects the industry on a mass scale.
Pachter’s statement was made before the launch of Modern Warfare 2 which has been recorded as the largest media entertainment launch in history. Despite the fact that Modern Warfare 2 for PC was the top selling PC Call of Duty ever, it still made up a small percentage of the game’s overall sales.
Pachter believes that going into 2010 the industry will start to show growth again after the dismal year that was 2009.
While he remains hopeful that the industry will recover, the outlook for PC gaming in particular is not as promising. With publishers increasingly moving towards consoles due to their higher sales margins, PC exclusive games are becoming rarer. Once the cornerstone of gaming, it now remains to be seen how well the platform will be supported over the next 5 years.
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