Despite 'Modern Warfare 2' Success, Video Game Sales Fall 8% in November

Video Game Sales fell by 8 percent in November according to research firm NPD , despite the record breaking debut of Activision Blizzard Inc.'s (NASDAQ: ATVI) "Call of Duty: Modern Warfare 2," but the number suggest a shift in game genres that consumers prefer.

The decline is sales saw the industry bring in $2.7 billion in revenue for the month that included the retail keystone, "Black Friday." A strong lineup of games did help the industry improve over the 19 percent drop seen in sales for October.

Analysts for Goldman Sachs see the industry shifting from being buoyed by a fad back to more traditional titles. Unit sales for the music and dance genre (Rock Band, Guitar Hero) were down 57 percent over last year, driving a 60 percent decline in category revenue.

Excluding the music and dance genre, sales would half been up in the video game industry by 11 percent.

Goldman Sachs maintains Activision as its top choice as the "Call of Duty" and "World of Warcraft" publisher is seen to be driven by an industry-leading 2010 title lineup, and the tremendous upside of "Modern Warfare 2."

Hardware sales in the month continued to benefit from price cuts across all three major consoles. Sony’s (NYSE: SNE) Playstation 3 was the biggest winner in November, with an 88 percent growth in unit sales, and sequential improvement over the 69 percent jump in October.

The Microsoft Corp. (NASDAQ: MSFT) Xbox 360 unit sales fell 2 percent, while the Nintendo Wii continued to struggle with a 38 percent decrease. This was the ninth consecutive month in dropping sales for the once hard to find Wii.

Total hardware sales dropped 13 percent to $1.05 billion in the month, while accessory sales dropped 6 percent to $242.2 million.

"Modern Warfare 2" set the bar in the month and for all-time as the game broke sales records with 6.1 million copies of the Xbox 360 and Playstation 3 versions of the game. Other top performers in software sales for November included Nintendo's "Super Mario Bros. Wii," Ubisoft's "Assassin's Creed II" and Electronic Arts Inc.'s (NYSE: ERTS) "Left 4 Dead 2."

Video game software revenue declined 3 percent year-over-year in November.

Gamestop (NYSE: GME), the top retailer of video games, said its US stores saw a 15% rise in new software sales in November.

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