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Analysts: Strong MW2 Wrestles Declining Wii, Deflating Music Genre For November NPD

The record launch of Modern Warfare 2 makes growth for November possible for the games business, say analysts ahead of the monthly NPD results -- but in a "horrible" year for publishers, there's not much to celebrate.
The record launch of Modern Warfare 2 makes growth for November possible for the games business, say analysts ahead of the monthly NPD results -- but in a "horrible" year for publishers, there's not much to celebrate. Wedbush Morgan analyst Michael Pachter expects to see November software sales up 7 percent year over year thanks to MW2, New Super Mario Bros. Wii, Left 4 Dead 2 and Assassin's Creed 2. The hardware picture looks challenging, though. Last November was the month in which Wii sold 2 million units -- the only console other than PlayStation 2 to beat a million in a single month -- and Pachter expects the console to do only half as much this November. Although topping one million units in a month is hardly poor sales, it's a difficult comparison; in fact, says Pachter, all consoles are expected to show year-over-year percentage declines except the PlayStation 3, which thanks to its price cut could be up as much as 85 percent year over year, and come out ahead of the Xbox 360 again in November. Concludes the analyst: "As 2009 draws to an end, it is clear that it will end as a horrible year for video game publishers. Notwithstanding a small rebound to sales growth in September, sales have been down seven of the last eight months, and although we expect modest sales growth in November, we think that sales are likely to track back into negative territory in December." In addition to relative market softness for the Wii, another factor challenging year over year comparisons has been the decline of the music genre, says Pachter, and Cowen Group analyst Doug Creutz agrees. Creutz says that November may not show much software growth at all, pointing out that PC software results could be a drag on the entire category -- last November's major launch of World of Warcraft's Wrath of the Lich King expansion means this November, PC software could be down 57 percent, possibly counteracting the month's strong core gamer slate. And Creutz also suspects that the big spike in MW2 sales is over, and may not continue to shoulder software growth into December -- meaning a decline for that month as well and a poor chance of posting overall year-over-year growth for 2009.

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