Bad economy doesn't derail Blu-Ray, video game sales

Well we all know the economy is in the dumper and layoffs and foreclosures abound. Sounds like perfect time to buy a video game console and lots of video games, doesn't it?Well, actually, that's what a lot of consumers are doing. Despite the terrible economy, sales of video games and hardware in the United States soared 18 percent in October from the same month a year ago, according to NPD Group. Hardware sales were up 5 percent to $494.7 million, led by the incredible Nintendo's Wii which remains the console to covet for all ages. The Wii sold 803,000 consoles in October, up from 687,000 in September. The Wii, which can't be found at most stores two years after its release, has sold more than 13 million units since its release in November 2006.Microsoft's Xbox 360 held onto the No. 2 spot by selling 371,000 consoles, a 7 percent increase over September. Sony's PlayStation 3 came in third with 190,000 units sold, an 18.2 percent increase.Software sales were up 35 percent to about $700 million led by Microsoft's Fable II, which sold 790,000 copies. What's behind all of this? I think it's the same thing as the spurt in movie ticket sales... people are simply staying home and playing games and not doing more expensive things like travel. Reggie Fils-Aime, president of Nintendo America, agrees with me."If I look at this from an industry perspective I think cautiously optimistic is quite appropriate," Fils-Aime told Reuters. "If I look at it from a Nintendo perspective, I would say very optimistic."He said the Wii console continues to sell out, while sales of the handheld DS game machine (which is a staple of every child's pocket) have risen almost 20 percent this year. For that reason, Nintendo has no plans to cut the price of the $250 Wii despite price drops by competitors.What the Wii has done is bring more gamers to the fold (older consumers, mostly) who are using games like Wii Fit and Wii Sports that are bridging the generation gap. Those consumers are unlikely to buy traditional gaming fare like "Grand Theft Auto" so the challenge will be to keep the pipeline full of software that will keep people of all ages interested.The real interesting item of the holiday season is the Blu-Ray DVD player, which is the new king of the format war. Of course, the Playstation 3 comes with a Blu-Ray player for $400, which at one time was a real bargain. Now Blu-Ray player prices are dropping like a rock (finally) and are expected to be below $200 in the next couple of weeks especially for holiday sales.The $200 price barrier will be very interesting as many people have been champing at the bit to upgrade to High-Def DVD movies but the format war and the high price of players had been putting them off. I think $150 is more likely to be the price point but I bet we'll see that on the day after Thanksgiving.(James Derk is owner of CyberDads, a computer repair firm and a tech columnist for Scripps Howard News Service. His e-mail address is jim(at)cyberdads.com)