Activision’s Call of Duty Modern Warfare 2 has done about $550 million in sales in its first five days on the market. Video games, when newly released, generally have inflated sales figures do to the practice of “reserving” a new game by purchasing it in advance, however that is still a high number of copies sold in today’s market.
But is it enough? The economy, despite official projections, is still suffering. The entertainment industry, which includes the sub-genre of Video Games, is suffering right along with it. Historically, this has not always been true during times of financial turmoil.
My Dad grew up during the Great Depression era, and I have heard many stories about his everyday life during those times. He was quick to point out that people flocked to the movies in those days, that being the chief form of entertainment. For roughly the price of a soda and a candy bar (twenty-five cents), you could attend a matinée that often featured several movies in a row.
At the start of the Great Depression, Hollywood nearly collapsed before they retooled and came back stronger than ever. Focusing on musicals, the industry regained its footing, soon becoming the one bright spot in many dreary lives.
Today, the entertainment industry is once again feeling the sting of an economic downturn: Console sales are down thirteen percent, gaming giant Electronic Arts is once again laying off workers after losing another $391 million vs last year and Nintendo has reported a 52% drop in profits for the beginning of 2009.
In the face of all of this bad news, are the unexpected Halo: ODST’s 1.5 million units and COD: MW2′s strong, out-of-the-gate performance enough to put a shine on the tarnished $19.5 billion dollar industry woes?
In my opinion, no. As the console dies down, social gaming is increasing. Facebook and MySpace are both enjoying a large increase in gaming from their prospective sites: Zynga’s family-friendly “Farmville” has an estimated 67 million users. Not too shabby for a free-to-play browser-based game, eh?
Escapism is the word often used to describe the influx of movie goers in the traumatic 1930′s as people sought to forget their daily woes by watching cheap, feel-good musicals at their local theater. Perhaps the same word could be applied to the growing social-gaming scene today.
Looking for a financial tip? Now would be a great time to buy into advertising-supported free-to-play social gaming companies. Trust me, they’re the next big thing…