A recession may be forcing consumers to tighten their purse strings this holiday season, but that isn’t stopping them from reaching for a joystick. While the U.S. retail industry has projected the slowest Christmas sales growth in six years at 2.2 percent, the video game sector has been a reliably bright spot amid the gloom.
Days ago, Microsoft Corp. reported record-breaking Black Friday sales of Xbox 360 consoles, up 25 percent from a year ago. The entire video game industry is on pace to increase revenues by 30 percent in 2008, according to the Entertainment Software Association.
And, as parents continue flocking to stores in search of games for a Nintendo Wii, Sony PlayStation 3 or Xbox 360, the head of the ESA reiterated support for the industry’s ratings system, which he called “the gold standard of media.”
“When parents can trust the marketplace for games, we sell more,” said Michael Gallagher, president and chief executive officer of the ESA.
Like the movie industry, video-game makers use a rating system that includes age recommendations and content descriptions. The Entertainment Software Rating Board also maintains a database of game summaries that parents can access via cell phone when perusing the shelves, Mr. Gallagher said.
In addition, he noted, the newest gaming consoles all have parental controls that enable parents to block games that have certain ratings, such as “Mature” or “Adults Only,” from being played on that system.
“This is a much better industry than some of our critics will give us credit for,” Mr. Gallagher said.
Critics of the video-game industry “lose their credibility” when they do not acknowledge the progress that has been made by the industry, Mr. Gallagher said. He cited a November report by the National Institute on Media and the Family that found 80 percent compliance among retailers with respect to verifying the ages of those who try to buy games recommended for people 17 and older.
While the ESA encourages retailers to enforce the industry rating system, the association has contested multiple state laws that would make doing so mandatory. At least nine times in the past six years, ESA has succeeded in legal challenges on the grounds that such legislation violates the First Amendment.
“I don’t understand why they would kill what is, in effect, their own rule,” said Tim Winter, president of the Parents Television Council, a family group that supports legislation pertaining to violent video games. “I will step back and say the ESA and their retailers have done a much better job [enforcing the ratings system] than they used to, but the failure rate is still too high.”
Mr. Gallagher said the industry continues to contest the validity of studies cited by the PTC - described by Mr. Winter as “accurate, objective and quantifiable” - that link violent video games to aggressiveness in children, noting that the judges who ruled in ESA’s favor questioned the validity as well.
The industry’s self-regulators are trying to keep up with new, interactive features such as user-generated content and connectivity with other gamers.
“For us, that’s a challenge that we need to continue to meet,” Mr. Gallagher said.
He stressed that children are far from forming the dominant bloc of gamers. The average age is actually 35. He credited the popular Nintendo Wii console for making games “approachable” for more people.
“You have octogenarians bowling again,” he said.
Monica Vila, founder of TheOnlineMom.com, a Web site devoted to helping parents navigate technology, said more people are going to stay home during bad economic times, making a video-game console a prime source of entertainment.
“Companies like Sony and others bank on this nesting trend in slow times, because they know people are probably going to spend more time at home,” said Ms. Vila, who plays Nintendo Wii with her nine-year-old daughter. Her Web site explains the ESRB’s rating system and provides decision-making tips for parents.
After posting $9.5 billion in revenue in 2007 - selling one game every nine seconds - the industry expects revenue growth of 30 percent this year, despite the recession, according to ESA estimates. The industry employs about 80,000 people nationwide at an average annual salary of $93,000 - numbers that have led several states, including Texas, Louisiana, Georgia and Michigan, to pass tax incentives to lure jobs there.