Analyst: Recession has finally hit the gaming industry

The latest numbers for the video game industry have arrived, and they're not pretty: We're talking a brutal 31-percent drop compared to June 2008, the steepest year-to-year dip since September 2000 and the fourth straight month of sub-2008 monthly gaming sales. 

NPD Group analyst Anita Frazier writes in an e-mailed release that June was "one of the first months where I think the impact of the economy is clearly reflected in the sales numbers," and that the steep slide in overall sales compared to last June "is certainly going to cause some pain and reflection in the industry." Ouch.

Taking a look at the hardware picture, the Wii still leads the console pack with 361,000—a "strong" figure considering the Wii's age, but still middling compared to the 500-600K units sold each month last year.

Meanwhile, the Xbox 360 actually beat its June 2008 sales figures with 240,600 units sold—indeed, it was the only console to do so, Frazier notes—while the PlayStation 3 is again in third place, with just 164,000 boxes changing hands. On the portable side, the Nintendo DS continues to do blistering business, shooting up 766,500 handhelds for the month.

The picture might not look that grim when you look at the individual horse race, but the sky begins to darken when you consider the overall gaming hardware market—just $382,000 in sales for June, compared to $617,000 for June 2008.

In terms of game titles—another soft month, says Frazier, with "Prototype" for the Xbox 360 putting up "solid" numbers (419,900 discs sold) for a new franchise, yet "modest" considering that it's the number-one title for the month. Also worth nothing, according to Frazier: after an "astonishing" 29 months in the limelight, "Wii Play" has finally dropped out of the top-10.

So, what's going on here? Is it just a matter of no huge, console-selling gaming titles—like, say, a "Grand Theft Auto IV"—so far this year? Probably not, says Frazier, who thinks that recession-weary gamers and consumers are simply spending less, at least "until a big event (must-have new title, hardware price cut) compels them to spend."

Of course, bad news for the gaming industry could spell good news for us gamers—in the form of console price cuts, which are rumored for the fall. Let's hope so.

Quick question for the gamers: Are you spending less on games this year? And if so, are you cutting back because of the economy, or are there just no recent must-have game titles?