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Kid video games Music is not the only entertainment sector experiencing declines and gaming is not going to be the savior of the music industry.  These are the two biggest takeaways for the music industry from a new NPD Group study on video games.

U.S. video game sales fell in August for the 6th month in a row. Down 16% from a year ago to $909 million and 14% year to date according to the sales survey. Hardware sales were down 25%.

In a related NPD report, kids 12 and younger account for 2% of video game industry unit sales and households with kids in this age group comprise 45% of total industry sales. With an average of 68 leisure hours each week, and the largest share of their leisure time going to entertainment, kids have a major influence on the game and music industries.

According to the report, which compiles a broad array of recent research on kids including how they spend their leisure time, share of wallet, content acquisition, and top brands and licenses, 57% of kids ages 2-12 play video games, and 62% of them use a computer. So, while it is a big market for games, this consumer segment is far from penetrated, representing an area for future industry expansion.

“According to the U.S. Census Bureau, there are 53.4 million of them ages 12 and under in the U.S., accounting for 17 percent of the population. Yet for many industries, games included, they account for a much larger portion of total sales,” said Anita Frazier, industry analyst, The NPD Group. “For the 12-months ending June 2009, this group of consumers comprised 24 percent of games industry unit sales. Tweens in particular are a highly involved group of consumers as 75 percent of this age group play video games and 81 percent are on the computer for non-homework related activities.”

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