In a report on the PC game industry today, The NY Times cites NPD data showing domestic retail sales of PC games (ex-online sales and subscriptions) are up 48% to $203 million in the first two months of 2007. "The robust performance we’re seeing in PC game sales can be tied to several key titles across several genres, ... but we’d be remiss not to address the continued success of World of Warcraft [by Blizzard Entertainment, a subsidiary of Vivendi (Games)]," says NPD analyst Anita Frazier. Still, retail sales of console games in '06 including handhelds totaled $6.5b, dwarfing PC games sales of $970m -- only a 1% y-o-y increase and 11.8% short of the $1.1b of sales in '04. Catalysts for change in the PC game software/hardware segments include efforts by Microsoft to make software purchases easier with ratings based on a PC's Vista OS evaluation, plans to expand its Xbox Live network to include PC games, and a $20 wireless PC adapter which allows Xbox controllers to be used with PCs. Dell and HP meanwhile, each acquired a niche PC manufacturer last year, both known for their powerful gaming PCs.
Sources: The New York Times
Commentary: Profiting From the Love of Gaming • Microsoft to Bring Xbox Live to PC Gamers • HP Enters the Niche PC Gaming Market With Its Voodoo Purchase
Stocks/ETFs to watch: Activision (ATVI), Electronic Arts (ERTS), Midway Games (MWY), Take-Two Interactive Software (TTWO), THQ (THQI), Microsoft (MSFT), Vivendi (OTC:VIVEF) [EPA: VIV], GameStop (GME). Gaming PC Manufacturers: Alienware -- acquired by Dell (DELL) in '06, Voodoo Computers-- acquired by Hewlett-Packard (HPQ) in '06. ETFs: iShares Goldman Sachs Software (IGV)
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