Video Game Sales Up 11% Last Year In Top Three Markets

Overall video game unit sales across the world's three largest markets rose by 11% in 2008, despite a decline in Japan, market researchers said Monday.

Growth in the United States and the United Kingdom increased 15% and 26%, respectively, offsetting a 13% decline for the year in Japan, according to a report compiled by the NPD Group, GfK Chart-Track Limited, and Enterbrain. The drop was largely caused by a decline in portable software and the shrinking PlayStation 2 software market, which experienced a 46% drop last year in terms of units in the Asian country.

The drop in sales in Japan contributed to a profit warning issued last week by Nintendo, maker of the Wii console. The Japanese company reported that the profits for 2008 would be 33% less than expected.

Combined video game sales across the three countries totaled 409.9 million units, compared with 367.7 million units in 2007.

The United Kingdom experienced the highest category growth among the top three markets, as well as the largest aggregate growth. Unit sales of console software rose by 38% and portable software 6%. In the United States, console software growth was 22% and portable software sales were up 2%.

The U.K. market has been growing rapidly, with unit sales more than doubling what was achieved in 2003. Because of the growth, the United Kingdom last year overtook Japan for the first time as the second-largest world market, behind the United States.

"Although still behind on revenue, the gap has narrowed considerably and it will be interesting to see how things develop during 2009," Dorian Bloch, business group director at GfK, said about the United Kingdom in a statement.

In the United States, 268.4 million video game software units were sold last year, an increase of 36 million over 2007. In 2008, the United States saw only two months of declines over the prior year, NPD analyst Anita Frazier said. One was because of the release of the blockbuster "Halo 3" for Microsoft's Xbox 360 in September 2007. The release broke records and no similarly successful title was released in 2008. The second month's decline was because of an additional week in the January 2007 retail calendar.

The top five video game titles last year in terms of units sold were Nintendo's "Mario Kart Wii," "Wii Fit," and "Super Smash Bros: Brawl" with 8.94 million, 8.31 million, and 6.32 million units, respectively; Take 2 Interactive's "Grand Theft Auto IV," 7.29 million units; and Activision Blizzard's "Call Of Duty: World At War," 5.89 million.

The market figures are based on point-of-sale data gathered by the three market research firms.