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EA & Activision Dismiss NPD Data

| 15 Mar 2011 00:00
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Because NPD isn't providing monthly evaluations of digital sales, some of the biggest players in the videogame industry are publicly dismissing the group's monthly reports.

Last Friday, NPD reported that videogame sales were down eight percent in February. As a result, CNN is reporting that publishers Electronic Arts and Activision have stated that NPD's reports are misleading and "potentially irrelevant." Essentially, publishers have a problem with NPD because it doesn't track sales in digital marketplaces like the PlayStation Network and Xbox Live.

"Using NPD data for video game sales is like measuring music sales and ignoring something called iTunes," said EA's Tiffany Steckler. "We see NPD's data as a misrepresentation of the entire industry."

Meanwhile, Anitz Frazier (an NPD analyst) explained NPD does release a report that focuses on digital sales, though it only comes out once a quarter: "This is in addition to what we are best known for and that is our monthly reporting of new physical sales occuring at retail."

Members of the industry dismissing NPD's information isn't all that uncommon. When sales are good, companies will often mention how popular a game is in future advertising, while the data is often publicly ignored if it isn't what a publisher wants to hear.

Unsurprisingly, Michael Pachter weighed in on the issue, saying it was a "gross overstatement" to totally dismiss NPD's information because physical sales are still a huge part of the industry: "EA saying physical game sales don't matter is like Best Buy saying television sales don't matter."

In this case, it's hard not to agree with the publishers. Digital sales (not to mention online subscriptions for games like World of Warcraft) are certainly a major part of today's videogame marketplace. Case in point: Electronic Arts' digital sales reported that it expects its yearly digital revenues to climb to a to a total of $750 million by March 31st. From the sound of things, it seems like NPD is going to have to change its reporting methods if it wants to continue being taken seriously.

Source: CNN via Spong

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