Video Game Sales Fall in 2004

U.S. video game industry sales fell about 1% in 2004, an industry research group said Tuesday, as growth in software offset a sharp revenue decline in console hardware.

In total, sales of game hardware, software and accessories reached $9.9 billion in 2004, down from $10 billion in 2003, NPD Group said.

Total software sales rose about 8% to $6.2 billion as sales of games for portable devices broke $1 billion for the first time.

The bestselling game of 2004 was “Grand Theft Auto: San Andreas” from Take-Two Interactive Software Inc. with more than 5.1 million units sold, followed closely by “Halo 2” from Microsoft Corp. with more than 4.2 million sold.

But hardware sales fell 17%, a decline blamed on lower prices for consoles plus severe shortages at the holiday season, particularly Sony Corp.’s PlayStation 2 and Microsoft’s Xbox.

NPD declined to offer forecasts for 2005. The president of the Entertainment Software Assn., the industry trade group, said much depended on whether there would be new consoles this year.

NPD also said the number of games sold with online capability rose 127% in 2004 as online-enabling hardware also rose in the ranks of accessories sold.