If you run through VGC data for 2004-2009, and throw in 2010 YTD SW figures for the five current platforms (Wii, PS3, X360, DS, PSP) you see that just about every publisher is going to struggle to match their peak figures on the current round of systems. This is even with some companies still set to post record figures on individual systems (Ubisoft on Wii, Square-Enix on all three consoles, Sega on PS3 is already a record, Konami is a possibility on Wii, Capcom will likely see record figures on PSP...not much else). Figures below are worldwide and millions of units for each publisher across the five current systems.

Pink figures indicate publishers that might see record sales on the current five machines in 2010. Even with the holiday rush yet to come its hard to imagine companies like Activision and EA making up the difference from last year to 2010. Activision still has Call of Duty - which could sell something like 15 million copies - and DJ Hero 2 - which might sell 3m copies in 2010, its catalogue, and other stuff...but that still gets them no where near the 60m games they sold last year. Something like 40 million units is more likely. EA is similar - Rockband 3, Medal of Honor, and others will do several million units each...but it isn't enough. For Nintendo, if you figure 8m Wiis between now and the end of the year, catalogue sales, Wii Party, DKC, Kirby, etc its still hard to see Nintendo getting past 110m units of sw for the year.

First party efforts for Move / Kinect will likely get Sony / Microsoft to record sales on the current machines, but it looks like just about every third party will be down alot this year. With 3DS set to harm DS and PSP next year, and Wii / PS3 / X360 all likely to be off their 2010 paces, its hard to imagine next year being any better for the majority of publishers on the current machines, and so the next round of systems shouldn't be too far off.

DS and PSP are pretty old now, and they'll have their successors release next year. Wii may have peaked, 360 hasn't. Dunno about PS3. 

This is a natural decline associated with the 5-6 years console cycle, despite new customers entering , perhaps for the first time, the market.

We are in the part of the cycle where every game has a 2,3,4,5 attached to it and customers have probably become a bit fed up. lost passion, about the current round of consoles. Furthermore this must be exacerbated by super cheap gaming on smartphones coupled with tight finances for most households in the developing world.

Sony seems to be in a better position to wheather this decline as they have the widest distribution network and brand appeal to penetrate countries hungry for western goods such as Russia, India, Brazil, China and Eastern Europe.

The 3DS will re-energize the market altghough personally Im not so hyped about it as all I have seen on it is sequels and zero new IP.

Does a software peak coincide with a system's hardware peak? Does the software peak come a year or three later after the hardware peak? Is it possible for a software peak to come more than three years later after the hardware peak?

Good stuff, thanks for your time.

This generation peak hw seems likely to coincide with peak sw for each system. Doesn't always happen that way - the peak for sw can be two years after the hw peak, particularly for a system that has peak hw sales when the base is still small relative to later figures.

It would be interesting to plot hardware vs software for each system in regular time intervals (say monthly or quarterly). This would give you the full story for how the peaks are related

You think the PSP2 is going to be released next year?  Sony has been pretty quiet about it and the only thing that was ever said about PSP2 was that a developer or two have been working with it.  They probably need to release the PSP2 next year or they will be left in the dust by the 3DS.  If it can sell as much as the first then it wouldn't be too bad but I don't see Sony overtaking Nintendo in handheld sales anytime soon (or ever). 

On Topic:  Yea, it looks like SW sales have peaked or will peak this year.  I am hoping this home console generation will last another 2-3 years though.  My guess would be someone will release a new home console system in 2012.

I blame Farmville!

Wasn't the PS3 software something like plus 20mill YOY YTD vs 2009? That means software sales didn't peak on the PS3 yet. (And GT5 is still not out.)

Double post.