U.S. Video Game Industry Sales Fell 8% in 2011 to $17 Billion

43 REP Call of Duty Modern Warfare 3 H
Courtesy of Activision

Activision CEO Bobby Kotick's "Call of Duty: Modern Warfare 3" (pictured) earns more than $775 million in five days of release, besting the opening total for any other form of entertainment.

Spending on all video-game content in the U.S. reached an estimated $16.3 billion to $16.6 billion, down 2 percent.

NEW YORK -- Research firm NPD Group said on Thursday that U.S. consumer spending on video games in the new physical channel fell 8 percent to $17 billion last year, compared with $18.6 billion in 2010.

Spending on all video-game content in the U.S. reached an estimated $16.3 billion to $16.6 billion in 2011, down about 2 percent from 2010.

The estimate -- final data will be available in March -- includes new physical video and PC games, used games, game rentals, subscriptions, digital full-game downloads, social network games, downloadable content and mobile games.
Retail sales of new physical sales of video-game content declined 8 percent to $9.3 billion, compared with the $10.1 billion recorded in 2010. Hardware sales and accessory sales each fell 11 percent to $5.6 billion and $2.6 billion, respectively.

HD console software sales rose 9 percent, with used-games sales, full-game digital downloads, downloadable content and mobile gaming apps also showing growth.

Call of Duty: Modern Warfare 3 was the top-selling game of 2011, according to NPD, which didn't break out revenue or the number of units sold. Just Dance 3, Elder Scrolls V: Skyrim, Battlefield 3 and Madden NFL 12 round out the top 5. Warner Bros. Interactive's Batman: Arkham City ranks seventh for the year.

“Overall industry results are not entirely surprising given that we are on the back end of the current console lifecycle, combined with the continued digital evolution of gaming," said NPD analyst Anita Frazier. "Core gamers continue to be engaged and spend on established franchises across both the digital and physical format using multiple devices for different gaming occasions."

In December, hardware and accessories sales dropped 28 percent and 27 percent, respectively. Total software sales were down 15 percent.

Email: Georg.Szalai@thr.com

Twitter: @georgszalai