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NPD Reports Sales Down in First Half 2004

According to The NPD Group, retail sales of U.S. console and portable video games hardware, software, and accessories saw a decline of 2.5 percent during the first half of 2004 (January – June), compared to the same time period last year.

The video games industry saw sales figures fall to $3.4 billion in the first half of 2004 compared to $3.5 billion in the first half of 2003.

While dollar sales dropped slightly, overall unit sales of video games hardware, software, and accessories were up 1 percent during the first half of 2004.

Console software and console accessories were the only categories to show growth during the first half of 2004, with software revenue increasing 4 percent and accessory revenue increasing 8 percent.

Within accessory sales, Internet components and specialty controllers saw the most growth, with dollar sales increases of 120 percent and 184 percent, respectively. All other categories, which include console hardware, portable hardware, and portable software saw dollar sales decreases of 17 percent, 10 percent, 12 percent, respectively.

"The reduced price points for Microsoft's Xbox and Sony's Playstation 2 helped to stabilize industry sales during the first half of the year," said Richard Ow, senior video games analyst, The NPD Group. "While the first quarter of 2004 was showing double-digit losses in console hardware unit sales, with the help of lower price points for the Xbox and PS2 during the second quarter of 2004, the industry actually saw double digit increases in unit sales for the entire second quarter of the year."

Along with the report, NPD released a list of the top selling games for the first half of 2004.

No surprise that Electronic Arts owns three of the top ten spots. Nor is it any wonder that Spider-Man 2 cracked the top ten even though it has only been on sale for approximately 6 weeks. Big ups to Microsoft's Halo, which has been in the top ten for nearly 3 years now. Biggest surprise? Need For Speed: Underground isn't in the top ten, even though it has been one of the top most-rented games of 2004. As Aaron says, "just buy it already!"

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