Recession Affecting Console and Game Sales

Not very far in the past, gaming companies like Nintendo, Microsoft and Sony declared high profits and claimed that their success would continue.

However, the recession has affected these companies, just as it has affected companies in other industries.

Nintendo, the market leader in console and game sales, reported a 66 percent fall in operating profit in the last financial quarter.

Microsoft’s revenues fell by 5%, while Sony reported a loss of £238m.

Nintendo has blamed its loss on fluctuations of international currency, while Microsoft says its decline in revenue was due to reduced prices.

Factors that may have led to the decline in sales could be the reduced amount of discretionary income held by consumers, as well as an increase in the use of free online games.

Market research agency comScore says that there was a 22 percent rise in free online gaming last year. Over 87 million people in the US are registered players of free online games.