UK game revenue to surpass music and DVD in 2008

A report from retail analysts Verdict Research says that UK sales of games will outstrip music and video for the first time in 2008. They predict that spending on games will increase by 42% to £4.64billion by the end of 2008. This beats the combined estimated sales of music and movies at £4.46billion. 

In the last five years the market for video games has more than doubled, and it wouldn’t be a great leap to state that much of that is due to the astounding success of Nintendo’s DS and Wii platforms, as well as a little-known title called Grand Theft Auto IV.

In contrast, the music and video industries have been suffering a huge slowdown in growth, mainly down to a shift away from traditional retail outlets towards spending on the internet. It’s actually online sales of DVD’s and CD’s that have been accounting for most of this shift though, as digital distribution still only accounts for around 4% of music and video sales.

 Retailers like HMV and Zavvi, and even supermarkets like ASDA and Sainsburys have recently been seen to be cutting back on space allocated to CD’s and DVD’s to make way for more displays and shelf-space for the more lucrative video games.

However, retailers have warned that although game sales are certainly booming in comparison to other media, that the Verdict Research figures may be misleading. “There is no doubt that the games sector is having a fantastic year,” says Steve Redmond of the Entertainment Retailers Association (ERA), “but these figures overstate that by including games hardware.”

So whereas the figures for games revenue include console sales, the relative totals for music and movie sales dont include any CD and DVD hardware. ERA’s sales figures for last year show that games made £1.7bn, music made £1.4bn and video revenue was £2.2bn. “Our prediction is that games will overtake video by the end of this year,” says Mr Redmond, “but not music and video combined.”

So, have you spent more on gaming this year than last year?