UK video game sales have seen a substantial decline, dropping by 30% in the first half of 2024 compared to the same period in 2023. This trend aligns with a broader global downturn in the video game market, with significant reductions observed across Europe, particularly in console sales for Xbox.
According to the Entertainment Retailers Association (ERA), both physical and digital video game sales in the UK fell by 29.4%. Physical game sales plummeted by 40% to £111.7 million, while digital downloads decreased by 23% to £263.9 million.
In contrast, music sales, excluding streaming, increased by 7.9% year-over-year to £163.8 million, demonstrating the relatively stronger performance of the music market despite its lower overall sales volume.
Why Have Video Game Sales Dropped?
The ERA attributes the drop in video game sales to a “soft new release schedule.”
The first half of 2023 saw the launch of The Legend of Zelda: Tears of the Kingdom for Nintendo Switch, a significant title that boosted sales during that period. In contrast, the most notable release in the first half of 2024 was Final Fantasy 7: Rebirth for PlayStation 5, which did not match the sales impact of its predecessor.
CEO Kim Bayley of the ERA noted the absence of heavy-hitting titles as a significant challenge but expressed optimism for the second half of the year, traditionally a peak period for blockbuster game launches. Anticipated releases include:
These upcoming titles could potentially boost sales.
Economic Factors Influencing Sales
The high cost of video games, exacerbated by the current cost-of-living crisis, has made them less accessible for many consumers. This economic strain, coupled with fewer major game launches, has led to a notable reduction in annual video game sales, which have now fallen behind movie revenues for the first time since 2012.
Despite the downturn in video game sales, the sector remains larger than the music and video sectors. Total spending on video games from January to June 2024 stood at £348.6 million, compared to £213.7 million for video and £163.8 million for music.
The video game industry has also faced broader challenges, including layoffs, studio closures, and the cancellation of games close to their release dates. These issues underscore the volatile state of the entertainment industry, which continues to grapple with significant economic and operational hurdles.
Featured Image courtesy of PHIL BARKER/Future Publishing via Getty Images
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