Video Game Sales Fall, While Downloads Increase

Video games are getting better in terms of quality, so why are sales falling month after month? David Greene talks to Chris Kohler, who writes about video games for Wired Magazine. The two examine the trends and new technologies reshaping this big, and growing industry.

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DAVID GREENE, HOST:

It is August, and for NFL fans that means time to gear up for the new season.

(SOUNDBITE OF VIDEOGAME, "MADDEN NFL")

UNIDENTIFIED MAN #1: Flacco will hand it off.

UNIDENTIFIED MAN #2: Defense is the recipe for success, and this team has enjoyed a lot of it.

GREENE: The newest version of the widely popular game "Madden NFL" is due out next week. This game has become so high quality it is hard to believe you're not actually in the game. Videogames are getting better and better in terms of quality, the sophisticated graphics and technology. And yet, industry sales are falling month after month?

To talk about that and to talk videogames in general, we reached Chris Kohler. He plays games. He writes about videogames for Wired Magazine.

Chris, thanks for joining us.

CHRIS KOHLER: Thanks for having me.

GREENE: The latest figures we have are for July. And sales of videogames and also the hardware accessories that go with them, down 20 percent. What's happening? Are people not buying?

KOHLER: It's not the top of the market, and it's not the cheaper games - like the iPhone 99 cent games - that are doing badly, but it's the whole middle. You know, with the PlayStation 2 and older game systems, there were a lot of different publishers being able to publish games at 40, $50 that were, like, B titles. You know, they weren't as good as the big games. But once you got through all the really big, good games, you know, you still had gaming time left in your day and you'd go out and you'd buy - because you really had no other choice - these's 30, 40, $50 games. They weren't your first choice, but it was something to fill the hours with.

These days, you know, a lot of that is getting filled up with games that can be on Facebook. They can be on iPhones. They're free. Some of them are excellent, high-quality games. And so what people - what gamers seem to be doing is they're going and they're buying the "Maddens" and they're going, they're buying the "Call of Duties" and the "Halos" and that sort of thing, and they're spending $60 per game. But then all of that stuff in the middle is falling away. And so that, I think, is why you're seeing these declines.

And what's important to also remember here is the declines in videogame industry sales are for physical, packaged goods. There's actually been a huge explosion in terms of sales of games that are purely digital. In that sense, the videogame industry is exploding, but it's being offset by this decline in the traditional packaged model.

GREENE: You talk about kind of facing a new reality.

KOHLER: Mm-hmm.

GREENE: Sony and, you know, has the PlayStation, Microsoft has the Xbox. They started offering their games as downloads. But Nintendo really held out until very recently. They've now released a download of, of "Super Mario Brothers 2." I mean, was that a huge moment in the industry?

KOHLER: Nintendo is a very conservative company. And when even Nintendo is doing something future-looking, that means that its time has come. What it is doing now is it's offering games - its big, big games, like "New Super Mario Brothers" - and giving consumers the choice: Do you want to purchase it on a traditional cartridge, or do you want to download "New Super Mario Brothers"?

GREENE: You mentioned Nintendo being very conservative. You know, they...

KOHLER: Yes.

GREENE: ...just decided to go with the downloads. They have this new hardware set-up, the Wii U. I mean, could this potentially be game-changing technology?

KOHLER: The Wii U is the absolute X-factor right now of the videogame industry. I think people can - if they use its interesting facets properly - and that is to say the Wii U, the controller itself has a touch screen built into the controller. And what they really want people to do with this is not only to play games that use both screens, but also sort of pitching this idea of certain games, if you don't want to use the TV, you can just use the controller.

And one of the things they've actually got on this is, you know, you can be watching Netflix on your TV, and then just press a button and instantaneously, you can be watching Netflix on the controller, which is wireless. So you can get up and leave the room. So, it's like if you're watching Netflix and you have to either go to the bathroom or whatever, you can, you know, you can sort of bring it with you and do that.

So it's a very, very novel idea, but people don't buy hardware because the hardware has a novel idea inside of it. They buy it because there's killer app software. So it is incumbent upon Nintendo at this point to show software that really makes people go, oh, man, like, I have to own this thing.

GREENE: So the fact that you can carry a little tablet to the bathroom is not going to necessarily sell the game. It better be good.

KOHLER: A lot of people use their tablets and cell phones on the toilet.

(LAUGHTER)

KOHLER: Like, when they do studies, it is like a double-digit percentage of people who - who admit to doing this.

GREENE: If you're out there listening, you know who you are.

Chris Kohler, thank you for joining us. This has been fun.

KOHLER: Pleasure.

GREENE: Chris Kohler writes about videogames for Wired magazine. And we are going to stay on the theme of videogames. Tomorrow on the program, you'll hear about a new style of gaming in Japan.

UNIDENTIFIED MAN: The majority of these games are designed in a way that they can be played in short bursts.

GREENE: These games are making train commutes more fun and one man a lot of money. That's tomorrow here on MORNING EDITION.

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