Video-game sales decline in March

updated 6:09 p.m. ET April 18, 2006

NEW YORK - Sales of video-game software fell again in March and will likely decline further as gamers await new systems from Sony and Nintendo next fall, market research firm NPD Group said Monday.

The industry posted U.S. software sales of $499 million last month, down 8 percent from the year-ago period, NPD said, adding that monthly sales of hardware tumbled 31 percent to $220 million.

Accessories sales also dropped 11 percent to $100 million. Altogether, overall industry sales declined 16 percent to $819 million, NPD said.

Anita Frazier, NPD's video-game analyst, attributed the decline partly to an upswing in hardware sales last March following the release of Sony's PlayStation Portable and to the debut of several hit titles during the first three months of 2005, such as "Gran Turismo 4."

Meanwhile, industry sales continue to slump as gamers refrain from buying existing titles while waiting for Sony's PlayStation 3 _ set to hit shelves in November _ and Nintendo's Revolution, which is also expected later this year. Microsoft's Xbox 360 reached retailers in late November, but a supply shortage has hampered its sales performance.

"And things are likely to get worse before they get better," Frazier said. "As we get closer to the release of PlayStation 3 and Revolution, more consumers will likely delay purchases in anticipation of a pricey hardware purchase."

Frazier said the industry could get a boost from the upcoming release of several popular games, but noted that the list is slimmer than in the past few years.

So far this year, software sales have dropped 8 percent to $1.2 billion, while hardware sales have added less than a percent to reach $662 million. Including accessories, overall industry sales of $2.2 billion are down about 6 percent from last year.

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