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U.S. video game spending stagnated at $4.6B in the first quarter

Above: GameStop at midnight for the launch of a new game.

Image Credit: GameStop

Total consumer spending on video game hardware, software, and accessories fell 1 percent to $4.6 billion in the first quarter in the U.S. despite the arrival of two new consoles on the market.

Market researcher NPD Group did have some positive news on the Xbox One and PlayStation 4 front; video game hardware revenues rose 47 percent to $983 million in the quarter thanks to the new consoles. And these strong year-over-year trends are likely to continue through most of 2014, according to Liam Callahan, game analyst at NPD.

Overall content was down 8 percent due to a 27 percent decline in physical retail sales. Digital game spending, however, grew 4 percent, with full game downloads and downloadable content for consoles and portables driving this small increase.

“For the first quarter of 2014, content spending increased for used games, digital full games, DLC, and mobile, with a modest increase in subscription revenue.” Callahan said, adding that “this is another example of the interplay of physical media as well as digital downloads as consumers transition further into this console generation.”

Gaming accessories sales fell 11 percent during the first quarter to $446 million compared to a year ago. The bright spots were gamepads and interactive gaming toys.


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7 comments
Nielo Olein
Nielo Olein

The major issue last gen was hardware. Both companies sold their consoles at heavy losses. In fact, neither Sony nor Microsoft made any profit from their platforms. Sony still have yet to develop SoC solution for the PS3 (hence the high price tag) and MS has no reason to drop the price of the 360, which is making decent profit . This time, both consoles are sold at minimal loss. Only a few quid loss per console. They are already based on SoC, so they just have to shrink the die every 18-24 months. So there no reason for them not to drastically drop the price over the next few years.

Joshua Peter Hodge
Joshua Peter Hodge

I can't see the prices dropping that much within a few years, discounting the Wii U. Maybe after 6 or so years, yeah.

Nielo Olein
Nielo Olein

I live in the UK too and I remember when PS3 used to cost nearly £500 at the time of launch. With inflation, it's probably £600 now. 8 years on, PS3 still costs £180 (12GB Model). In comparison, PS2, Xbox and NGC dropped below £100 within 6 years after launch. 360 did launch with price tag of £280 (20 GB Model), but in 9 years, it only dropped by £100 (250 GB Model). Last gen was terrible if you ask me (especially when you factor in hardware failure rates and major losses). But despite all that, gaming industry managed to keep growing (even in the UK). This gen seems to be off to a good start. We'll probably see sub £200 price tag in few years

Joshua Peter Hodge
Joshua Peter Hodge

I can't much comment on your link. All I know is that in the UK, where I am, the cost of living has been rising over the console generations, whereas salaries have remained pretty much constant. In fact, it seems I only glimpsed the title, as it doesn't apply over here, which makes my initial comment moot. Ah well. Staying up all night does not do me any favours.

Nielo Olein
Nielo Olein

Doesn't this happen every generation? Not sure why this is news. It'll probably pick up this fall

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