Video-Game Market Tops $8B In 2004

Rentals, sales combine for record mark.

Total sales and rentals from video, portable and computer games and rentals topped $8 billion for the first time in 2004, including a record 248 million unit sales alone.

Software was the driving force for the third $11 billion-plus year in a row for total industry sales and rentals of hardware, games and accessories.

Most important for traditional music, video and electronics retailers who have significantly expanded store space for games, nine of the top 10 video game titles had significant, complementary soundtrack releases.

The top trio were Take II Interactive's "Grand Theft Auto: San Andreas," which sold over 5.1 million copies just since its October release; Microsoft Games' "Halo 2," which topped 4.2 million copies in less than two months of 2004 sales; and Electronic Arts' "Madden NFL 2005," the first game soundtrack to go online as a special Apple iTunes playlist.

According to NPD, which tracks retail game sales, video console software reached $5.2 billion last year, a 7% gain from the previous year, while units topped 186.5 million, an 8% increase from 2003. Portable handheld software, getting a big boost from the November debut of Nintendo's DS (DualScreen) game system, topped $1 billion for the first time, up 11% from the prior high of $900 million. More than 42 million units were sold, a solid 13% increase from the prior year. Computer games, while still healthy, were down about 12% to $1.1 billion dollars, with 45 million units representing a 14.7% decline.

The 248 million total units represent a 4% increase from the previous mark of 239 million in 2003.

Total rental dollars topped $715 million, a 3% gain from the $696 million reported in 2003, according to HVE/Rentrak, which tracks these transactions at retail.