Analyst Jesse Devinch says that while games like Guitar Hero and Rock Band will remain profitable for another decade, sales appear to have hit the ceiling.
Electronic Entertainment Design and Research (EEDAR) analyst, Jesse Devinch, in his November 2008 retail sales report claims that Activision's immensely popular Guitar Hero series is "reaching its peak," and is predicting a more than 50 percent drop in series-over-series numbers in the upcoming NPD Group report.
The report (which also features some glum news for fellow publishing giants Electronic Arts and THQ) follows the already low numbers (for Guitar Hero anyway) for the recently released Guitar Hero: World Tour, which in series-over-series sales dropped by more than 60 percent in the month of October. While Activision was not able to meet the initial demand for the full-band bundle, sticker shock played a factor in the lagging sales as well.
When Guitar Hero III: Legends of Rock was released last year, it was met with full-blown Guitar Hero hysteria, with the price conscience PlayStation 2 and Nintendo Wii versions leading the charge on the charts for months to come. What's worse is that despite the supply constraints, Ebay resellers are having a tough time selling their bundles, forcing them to sell at less than the retail value ($189), "a strong indication that demand and supply are currently in equilibrium," claims Divnich.
Hope has not yet been lost in the decade-old modern rhythm genre, as Divnich speaks for the EEDAR in saying, "We expect Guitar Hero and Rock Band releases for the next 10 years as they will always have a large and loyal market base." Divnich points to Konami and its Dance Dance Revolution series as a prime example of a franchise that has been around the block more than a few times, reached its peak years ago and is still able to be a profitable.