Pachter: Industry is in ‘persistent secular decline’

The end is nigh. Pachter, hath spoken, and the disappointing May sales are the first signal that retail gaming is coming to an end. Speaking with MCV Wedbush Morgan analyst Michael Pachter illuminated how these sales and Nintendo’s oddly dropping software sales mean that retail gaming won’t be bouncing back from this slump.

“We expect investors to remain spooked by the May results, as they are beginning to reinforce the notion that the video game industry is in a state of persistent secular decline,” he warns. “We think it is inevitable that there will be a shift in delivery of video games away from packaged products and toward digital downloads, but we don’t expect the shift to manifest itself in a material way in 2010,” Pachter said.

“Rather, we believe that the publishers and developers of games have created more robust multiplayer content in recent years that has resulted in core gamers playing the same games for much longer, on average, than they did in the past, leading to lower sales of new games.”

Pachter rambled on some more about some other stuff, but the final conclusion was that the industry is changing thanks to multiplayer and downloadable content, and we shouldn’t be hoping for a comeback from retail purchases. Really, he’s not predicting the end of gaming, but simply the end of an era.

Pachter: Industry in permanent decline [MCV] [Image]

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Matthew Razak
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