ButtonBandits.com

We have a policy here at ButtonBandits of not writing stories based on what analysts say. At the end of the day what exactly is a video games analyst? Anyone can claim to be one but who judges whether they are qualified enough to comment? We have made an exception today to prove the point that anyone really can be a video game market analyst. Yesterday retailer GAME announced record sales for the first half of the year up 52% based on the same period last year. A financial analyst stated that he believes sales have peaked when he said  ”unless we see new hardware launches into the UK market over the next two years, which appears unlikely at present, then we believe profits will peak this year and fall consistently over the following three years,”. Despite the record sales, shares in GAME then plummeted by 14% following the comments.

Of course we are sure they have sound reasons for their opinion being what it is but to us it doesn’t make sense. The latest batch of consoles are only now beginning to be known as the current gen rather than next gen consoles. The PS3 has only been out for 15 months in Europe and is at the very start of a long product life cycle. The Xbox 360 has been out a little longer but still has many years left in it. Add this this to the rapidly increasing number of Wii’s getting into peoples homes that would never have dreamt of having a games consoles before and the customer base looking to buy games over the next few years is going to grow more than ever before not shrink. As very little money is made on hardware sales and the majority of the profits being in software, surely this means sales will only increase further over the next few years? We are only at the beginning of the current generation consoles lifespan and we are not aware of anyone wanting to be standing in line to buy a PlayStation 4 or Xbox 720 anytime over the next 2 years.

Another argument in favour of rising not falling sales is the current state of the UK economy. As people begin to make cut backs in leisure activities and travel following the increased cost of living, all of us game market analysts here at ButtonBandits HQ believe this will have a positive effect on video games sales. As people stop at home more over the coming years they will look for good value home entertainment products to pass the time. With many video games offering 30+ hours of entertainment from a £39.99 or less price they become an attractive purchase, particularly family oriented games that everyone can enjoy. Another point is that with people having less money this will further reduce demand for new high priced consoles at a time when the current gen will be at a low price with existing users quite happy to get the most out of their already purchased console of choice. 

Analysts ButtonBandits therefore believe that other than the effect of no GTA game in the first half of next year, GAME can expect sales to increase over the next three years as the console install base increases and so their potential customer base along with it. What they should be more worried about is when the next generation of consoles do come out rather than looking forward to it, what with the general trend towards bigger and bigger downloaded games sold direct to consumers, we imagine this will slowly lead towards the traditional retailer being cut out of the loop altogether and therefore sales declining as people shift towards this method of purchase.

Will all the big sites now run stories based on our opinion of what will happen? Of course they won’t, their reasons being the same as why we don’t run stories (anymore) based on what other analysts think will happen.