Despite some industry gains from January to February, overall sales totaled $1.06 million last month, down from $1.33 billion year over year; software sales fell 23 percent to $464 million, and hardware sales dropped 18 percent to $381.4 million.

February’s best-selling software title was Call of Duty: Modern Warfare 3, from Activision Blizzard.

While most hardware platforms posted declines year over year, “all current-generation platforms improved sales over January 2012 by more than 50 percent,” NPD said in a note.

A consistent bright spot has been the Microsoft Xbox, which was the best-selling hardware platform for the seventh month in a row. Some 426,000 Xbox units were sold in February, marking the 12th consecutive month Xbox has held more than 40 percent of the current-generation console market share.

And all eyes were on the Sony PlayStation Vita handheld gaming device, which came to market in late February. Only four days of retail sales for the PS Vita were included in this reporting period, but the device gave overall hardware unit sales a month-over-month boost. Not including the PS Vita, hardware unit sales increased by 62 percent over January, NPD said; with PS Vita sales included, the increase was 87 percent.

“More than 1.2 million PS Vita units have been sold globally since launch,” Patrick Seybold, senior director of communications at Sony Computer Entertainment America, said in a statement. “Customer satisfaction rates are very high and momentum will continue as gamers get their hands on a deep lineup of blockbuster titles that take advantage of PS Vita’s unique features, including cross-platform play with the PlayStation 3.”

In January, the videogame industry saw a double-digit decline in physical software sales, as my colleague Tricia Duryee reports, following a number of noteworthy game launches ahead of the holiday season.

Electronic Arts is predicting that the New York Giants will defeat the New England Patriots in the Super Bowl, by a single field goal.

For the past several years, the videogame publisher has been using its hit title Madden NFL to simulate the outcome of the Super Bowl — and in six out of the past eight matchups, it has guessed correctly.

But unlike the camel in the New Jersey zoo that has picked the winner of five of the last six Super Bowls, EA breaks down the score quarter by quarter.

EA simulates the Super Bowl by using artificial intelligence and real data from each team. It even includes variables such as injuries. The simulation is powered by Madden NFL and Xbox 360, the official console sponsor of the NFL.

EA replays the game’s highlights in a video, including Giants quarterback Eli Manning being named MVP for completing 25 of 39 passes with two touchdowns, and the Patriots’ Tom Brady throwing for 327 yards and three touchdowns.

Spoiler Alert: To win the game, Giants kicker Lawrence Tynes will make a 40-yard field goal, with the final score 27-24.

The NPD Group released a new report today that calculated the amount of money Americans are spending on games from the nontraditional market. That includes a lot of digital content, such as subscriptions, digital downloads, social games and mobile games, but also used games and rentals.

In the third quarter, it found that the amount spent on that “other content” totaled $1.64 billion.

While significant, NPD said it wasn’t enough to offset lower revenue from the traditional game market. NPD defines the traditional market as packaged goods sold at retail. In the third quarter, that totaled $1.3 billion.

“New physical retail sales had a rough third quarter,” said Anita Frazier, an analyst with NPD. “Increases in sales from some of these other monetization methods, and full game and add-on digital downloads in particular, only partially offset the decline see in the new physical retail channel.”

She said the overall market, including hardware, totaled $4.2 billion, down 11 percent compared to the same period a year ago.

For companies like Electronic Arts, which is investing heavily in mobile and social games and is placing big bets on online content, like today’s release of Star Wars: The Old Republic, the results of these monthly and quarterly reports are unrepresentative of the trends they are seeing.

“Everything is growing. If you look at the total interactive business, it’s a $50 billion market internationally, and that’s up double digits. That’s where we play,” said EA’s President of Labels Frank Gibeau. “We find it frustrating because it doesn’t tell the whole picture.”

In the second quarter, EA’s digital revenue, which includes downloadable console content, mobile and social — was up 30 percent year over year.

Even a company like Activision, which has been slower to develop games on Facebook and mobile, said that during the second quarter, revenue from digital channels — mostly downloadable content — increased 27 percent year ove year, and accounted for 37 percent of the company’s total net revenue.

For all-digital companies, like Zynga, which went public last week to raise $1 billion, its impact hardly seems to register.

“I think that ultimately we are an interactive entertainment company, not a packaged goods company,” Gibeau said. “We are platform and channel agnostic. The physical channel is a great channel and it’s going to be around longer than people think. … We are fine with that model, but then, when you bring that game home, you should be able to connect to the larger online world.”

“This November marks the best November on record for sales of new physical content,” said NPD Group’s Anita Frazier.

Activision said within the first five days of sales, Call of Duty shattered all previous entertainment records, grossing more than $775 million. In fact, its first month of sales beat the game’s predecessor by about 7 percent, NPD added.

In NPD’s report released today, it analyzed videogame sales for November, taking into account sales made at retail across both hardware and software. It excludes the sale of digital content, like mobile games and downloadable content.

In November, NPD said software sales totaled $1.7 billion, jumping 15 percent from $1.45 billion in the same month last year. Hardware sales weren’t so lucky, falling 9 percent to $982 million from $1.1 billion in November 2010.

The second-most popular title during the month was Bethesda’s Elder Scrolls V: Skyrim for Xbox, PlayStation and the PC. “In one month, Elder Scrolls V: Skyrim is just about half a million units shy of matching Elder Scrolls IV: Oblivion in lifetime sales. Its first month performance was a five-fold increase over Oblivion’s first month sales,” Frazier said.

The rest of the titles in the top 10 are:

• Battlefield 3, Electronic Arts
• Assassin’s Creed: Revelations, Ubisoft
• Just Dance, Ubisoft
• Madden NFL 12, Electronic Arts
• Uncharted 3: Drake’s Deception, Sony
• Saints Row: The Third, THQ
• The Legend of Zelda: SkywardSword, Nintendo
• Batman: Arkham City, Warner Bros. Interactive

But the day — or more accurately, the quarter — has arrived, when consumers spend more on digital games, such as mobile, social and console downloads, than they do on more traditional formats, like console games, according to the NPD Group.

UPDATE: I need to clarify that the category, which includes digital sales, also includes used sales and rentals, so it’s not purely digital sales that are exceeding retail sales, analyst Anita Frazier says. So while digital is absolutely growing, it’s not quite bigger than physical purely on its own.

In the second quarter, NPD estimates that digital revenues totaled $1.74 billion, exceeding the $1.44 billion spent on physical sales. That compares to the first quarter when the split favored physical sales of $2 billion, which topped digital sales of $1.85 billion.

While physical distribution in retail stores and packaged goods may be shifting to digital distribution over broadband connections and wireless airwaves, overall spending seems to be level.

In the second quarter, total videogame sales, including hardware, content and accessories, was estimated at $4.5 billion, which represents an increase of one percent compared to the same period a year earlier.

The NPD Group has not been tracking digital versus retail sales for very long, so it is unclear if this is the first time this has happened, or if the split will be permanent, but generally the trend is that digital revenues are growing while traditional retail sales are falling.

The shift for some incumbent videogame makers has been difficult to stomach.

Many debate the value of shifting from producing a $60 game sold at retail to producing mobile and social games, which frequently rely on a free-to-play model, where users have the option of playing without paying anything.

Others have embraced the concept, believing that the transformation will take place no matter what, or that it will grow the pie of people playing games.

To be sure, the market is just as confused about this period of disruption, leading values to be all over the map.

For example, privately held Zynga, which has filed to raise $1 billion in an IPO, was valued at $14.05 billion in August by a third party, according to a recent filing.

That makes the social games leader more than double the value of publicly held Electronic Arts, which has a market capitalization of $6.8 billion.

Meanwhile, Electronic Arts has been investing heavily in both mobile and social gaming, and, for instance, currently has the second-most popular game on Facebook.

Monthly game sales at brick-and-mortar retail shops have suffered as gamers flocked to both online marketplaces and cheaper games on Web sites such as Facebook and smartphones such as Apple Inc.’s iPhone.

Read the rest of this post on the original site »

A report released by the NPD Group found that total game sales from the retail channel, including hardware and software, totaled $1.03 billion, down 10 percent from June 2010.

All three sectors — hardware, software and accessories — recorded as well. Hardware was down nine percent, software was down 12 percent and accessories were down 11 percent.

The decreases were expected, since June can typically be slow as game developers wait to release big hit titles around the holiday period. Additionally, the makeup of the industry is changing.

The physical retail channel still generates the majority of industry sales, but there are a growing number of ways to play games, including mobile apps and downloadable content.

Earlier this week, the NPD Group reported that in the first quarter of the year, digital revenues totaled $1.85 billion.

In June, Take-Two Interactive had three of the top-selling games, including L.A. Noire in first place, Duke Nukem Forever in second and NBA 2K11 in seventh. Sony’s Infamous 2 placed third, and Disney’s LEGO Pirates of the Caribbean ranked fourth.  Nintendo’s Legend of Zelda placed fifth with 283,000 units sold.

The Xbox 360 continues to be the best-selling console, selling more units in the U.S. than any other console for 12 of the past 13 months. In June it sold 507,000 units.

But it was the holiday season that Microsoft was most excited about in a statement issued to the press:

“The size of the Kinect games portfolio will triple by the end of the year and Xbox will bring new partnerships like UFC and Disney to the platform as well as blockbuster games, movies, music and TV together in one place. We expect Xbox 360 to maintain its lead and to be number one worldwide by the end of the year, selling more hardware units than PlayStation and Wii.”

Already, the idea is starting to pay off.

Since then, the company’s game network (plus aspiring social network) called Moshi Monsters has registered 50 million users, mostly between the ages of 6 and 12 years old, and is adding a new player every second. It’s also on pace to generate $100 million in gross retail sales this year.

At E3 last week, I caught up with Mind Candy’s CEO Michael Acton Smith to hear about how he believes he can leverage the company’s social game roots to build a Facebook alternative for kids under the age of 12 and create an entertainment brand worth billions.

Acton Smith’s ambitious plans include bringing the monsters and other characters from the online virtual world into the physical world.

Mind Candy, which is based in London and has offices in New York, plans to officially announce tomorrow the availability of plush stuffed toys and mini-figurines based on the characters from Moshi Monsters. The toys will be sold exclusively at Toys “R” Us online and in stores nationwide starting in July.

The launch of toys in the U.S. follows the popularity of Moshi Monster-branded toys, books, video games, trading cards and a magazine in the UK and Australia, where the game is more popular. Of the 50 million users, only 15 million are in the U.S. today.

Acton Smith’s ambitions are like Harry Potter or SpongeBob SquarePants on steroids.

In addition to toys, he says they are working on music, live tours, a Moshi film and a videogame for the Nintendo DS.

In the game, players choose from one of six virtual pet monsters to name and take care of. They also get to personal and decorate a page and can post notes to a friend’s pinboard, which is a lot like the wall in Facebook. Subscriptions cost $6 a month, but not all users pay.

The company, which has 50 employees, has raised $10 million in venture capital from Index Ventures and Accel Partners.

Here’s a video interview with Acton Smith from the floor of the Los Angeles Convention Center at E3, where his Jimi Hendrix-type attire easily stood out from the rest of the hardcore gamers:

]]> http://allthingsd.com/20110613/mind-candy-brings-virtual-monsters-to-the-real-world-through-toys-r-us/feed/ 0 http://allthingsd.com/20110512/nintendo-ds-outsells-3-d-version-after-first-full-month-of-sales/ http://allthingsd.com/20110512/nintendo-ds-outsells-3-d-version-after-first-full-month-of-sales/#comments Fri, 13 May 2011 00:10:49 +0000 Tricia Duryee http://emoney.allthingsd.com/?p=5365 The original Nintendo DS family continued to outsell the Nintendo 3DS during the first full month the glasses-free 3-D handheld gaming unit was for sale.

According to NPD Group, Nintendo sold more than 620,000 hardware units in the U.S. in April. This includes more than 257,000 units in the Nintendo DS family, and only 194,000 Nintendo 3DS units. Nintendo also sold more than 172,000 Wii consoles.

Nintendo attributed the gap between the two handheld game units to the staying power of the original DS family–and avoided any implications that the 3DS was not selling well.

“With a rich library of games, Nintendo DS has something for everyone. The system’s staying power is exemplified by the recent launch of the Pokémon Black Version and Pokémon White Version games,” Nintendo said. Those two games sold an impressive 2.8 million units or more combined during their first 60 days of availability.

After the 3DS went on sale March 27, Nintendo was eager to report that the glasses-free 3-D device broke sales records. However, the original DS still appears to be benefiting from having a deeper catalog of games available for sale. Additionally, sales may have been hurt by concerns of younger players viewing 3-D images over long periods of time, or complaints that 3-D images made people dizzy, or gave them headaches.

Overall, NPD Group said that the videogame industry saw very strong sales for hardware, software and accessories in April, compared to the year-ago period.

NPD’s Anita Frazier wrote that all three categories experienced double-digit dollar growth compared to April 2010, reversing a negative downward trend.

“Easter purchasing occurred in April this year as opposed to March last year,” Frazier wrote. “The Easter timing shift could explain about $60 million of the growth, but even accounting for that shift, sales of new physical product realized a notable increase versus last year.”

Hardware sales were strong across the board with the PS3, PSP and Xbox 360 platforms all seeing an increase in unit sales versus April last year. The Xbox 360 platform was the best-selling device of the month in terms of unit sales, followed by the Nintendo DS.

Software performed even better in April. It was the first month that new physical retail sales of content showed growth in both units and dollars since November of last year.

]]> http://allthingsd.com/20110512/nintendo-ds-outsells-3-d-version-after-first-full-month-of-sales/feed/ 3 http://allthingsd.com/20110506/can-electronic-arts-really-become-a-digital-gaming-powerhouse/ http://allthingsd.com/20110506/can-electronic-arts-really-become-a-digital-gaming-powerhouse/#comments Fri, 06 May 2011 12:00:48 +0000 Tricia Duryee http://emoney.allthingsd.com/?p=5190 Electronic Arts CEO John Riccitiello talked a big game Wednesday, telling analysts on its year-end conference call that the 29-year-old company is well on its way to a major transformation.

It argued that instead of creating hits that are sold on store shelves for videogame consoles, the Redwood City, Calif.-based company wants to take popular franchises, like Madden or Need for Speed, and digitally distribute them across a number of platforms, such as mobile, social and PC, to create recurring revenue streams.

Riccitiello was unwavering in his commitment:

“The consumer has changed. 200 million console players have become 1.5 billion consumers gaming on multiple devices,” he said. “Today, we are a very different company….From here, it is about building a better, more predictable, and more profitable business, a business that is less dependent on individual hits and more deeply anchored in the ongoing monetization of game franchises.”

But the big question is whether EA can turn the ship when there are 8,000 employees on it who are used to doing business the old way.

Habits are hard to break, especially when it requires replacing a controller with a mouse or a touchscreen. In the meantime, some of its more nimble competitors are getting most of the credit as the industry shifts to digital.

For example, earlier this year, we watched as the private market valuation of Zynga–EA’s much smaller and younger competitor–exceeded EA’s public market valuation. Zynga was reportedly worth between $7 and $9 billion, while EA was valued at roughly $6 billion.

Today, EA’s market cap stands at about $7.25 billion.

Zynga, which makes such Facebook games as FarmVille and CityVille and has dabbled in mobile games, reportedly had revenues of $850 million in 2010. In comparison, EA’s digital revenues totaled $833 million for its fiscal year 2011. (Meanwhile, its overall revenues totaled much more, or $3.6 billion.)

Still, smaller competitors, such as Zynga, which strictly make money from digital revenues, are viewed as not having a lot of baggage and can go hard after something new without sacrificing the old.

Just last week, there was a sign that EA wasn’t winning that battle–even internally.

Electronic Arts disclosed that its COO John Schappert resigned. Rumors indicated that he was joining Zynga, although Zynga has not confirmed the appointment.

Despite that potential set-back, and EA’s public perception, it has been trying.

It has been on an acquisition spree for the past couple of years, picking up everything from Playfish, a social-games developer, to Chillingo, a mobile-games publisher. Earlier this week, it bought a small mobile-games studio called Firemint. (Of course, those investments also become a curse because they have to start paying off.)

Beyond acquisitions, it has also re-prioritized the work it was doing.

On the call, Riccitiello said that involved paring back the number of titles it was making from roughly 70 to around 20. While that was something of a defensive move, he said they are now shifting to offense, by picking the game franchises they do decide to build and porting them across several platforms to increase their profitability. “Over the coming years, we will transform EA from a packaged goods company to a fully integrated digital entertainment company.”

He calls it the “games-as-a-service” model, which is comparable to the software industry switching from a licensed packaged goods model to SAAS, or software as a service, several years ago.

Under this philosophy, he said, they will rely on intellectual property and strong brands, such as EA sports and Hasbro, and build out a platform of registered users that can be marketed to (in Q4, it had 112 million users, roughly twice as many from a year ago). It’s also making managers experts across mobile, social and console, rather than making silos for each category.

“It’s a big change,” Riccitiello said. “As an investor, you can see this as a way to better manage our IP, and drive up the ARPU for our core properties.”

At least one analyst was reluctant to believe the transformation could take place. How does Riccitiello plan to get everyone on board?

“If only you could spend a couple of weeks with us,” Riccitiello joked.

His more serious answer was that they’ve spent the past three years conducting a managerial change: “We’ve identified intellectual property owners inside of our company, and we’re sort of organizing around that.” Those individuals are charged with plans that involve console, PC, mobile, social and a variety of business models, including microtransactions and subscriptions.

The change will be relatively slow. This year the company is projecting digital revenues to total $1 billion, increasing roughly 20 percent over 2011.

And despite all of its efforts, the company will face other challenges, including some that are out of its control. For instance, the company’s EA Sports business is facing two potential league lockouts and this year there won’t be a FIFA World Cup title. Those three things represent roughly a $250 million revenue gap.

It’s also launching its biggest launch campaign for a game in EA’s history for Battlefield 3, and it’s unclear when the highly anticipated launch of Star Wars, an online multi-player game, will occur. Depending on when it is ready, EA’s earnings per share could fluctuate by 15 cents.

Overall, at least some people were sold on the picture Riccitiello painted.

The company’s stock increased a modest $1.76 a share yesterday, or roughly 8.8 percent, to close at $21.68. And Piper Jaffray analysts raised their price target on EA’s shares from $19.50 to $25.00.

]]> http://allthingsd.com/20110506/can-electronic-arts-really-become-a-digital-gaming-powerhouse/feed/ 2 http://allthingsd.com/20110415/sony-moves-eight-million-motion-controllers-to-challenge-xboxs-kinect/ http://allthingsd.com/20110415/sony-moves-eight-million-motion-controllers-to-challenge-xboxs-kinect/#comments Fri, 15 Apr 2011 16:37:23 +0000 Tricia Duryee http://emoney.allthingsd.com/?p=4516 Sony has sold more than eight million units of the PlayStation Move motion controller, revealing that while it continues to trail Microsoft’s Kinect, it may be beginning to catch up.

In March, Microsoft said it had sold 10 million Kinect sensors in the first four months. But it was evident that sales could be slowing after a huge spike during the holidays.

The two accessories are slightly different but serve the same purpose of extending the life of the videogame console by widening the audience it serves from the hardcore segment to the more casual player.

The Xbox Kinect uses a camera to track the movements of players, so they don’t need to use a controller at all. Generally, the best use case for it so far are games that mimic dancing, but recently, Xbox has started integrating the technology into other services, such as Netflix.

In contrast, the PlayStation Move, which uses a camera and a controller, is more similar to the Nintendo Wii.

Because the player must hold a controller, Sony claims, actions can be much more precise, making the system appropriate for a wider selection of games. There are also peripherals for the controller, such as the Sharp Shooter, which allows a user to simulate shooting a gun. Sony said despite limited supply, 40 percent of the time the Sharp Shooter accessory sold alongside Killzone 3 at key retailers.

During the holidays, Microsoft had a difficult time meeting demand for the Kinect, but supply has since caught up. Today, Sony also reported shortages of the Move.

In a statement, Bob McKenzie, SVP of merchandising for GameStop, said: “Due to the demand for the PlayStation Move motion controller, we’ve been struggling to keep units in stock in our U.S. GameStop stores. With big franchise titles set for release throughout the year for the PlayStation Move, we expect the remainder of 2011 to be a period of continued sales growth for PlayStation Move.”

Sony also said the PS3 has now sold 50 million units worldwide and has more than 75 million registered accounts for the PlayStation Network, which offers downloadable games and entertainment.

]]> http://allthingsd.com/20110415/sony-moves-eight-million-motion-controllers-to-challenge-xboxs-kinect/feed/ 8 http://allthingsd.com/20110315/nintendos-3ds-brings-dizzying-fun-on-the-go/ http://allthingsd.com/20110315/nintendos-3ds-brings-dizzying-fun-on-the-go/#comments Tue, 15 Mar 2011 22:35:29 +0000 Katherine Boehret http://solution.allthingsd.com/?p=1691 The first videogame that promises 3-D without the goofy glasses is about to hit stores, but in my tests, it made me a little dizzy.

On March 27, Nintendo is introducing the 3DS. This apparent breakthrough turned negative for some when Nintendo added a warning to the device that said viewing 3-D images by children age 6 and under may cause vision damage.

Unaffected by age restrictions, I’ve been using the 3DS for the past week, and it’s a lot of fun—though its chunky design looks like the company is taking a step back rather than forward. Its 3-D screen works as advertised without 3-D glasses, though its effects can’t be seen from side angles, so friends trying to peek at the screen won’t see much. It made me a bit dizzy after a while, so I adjusted a 3-D Depth Slider to make the screen images appear less three-dimensional. This slider, or a setting in parental controls, can turn off the 3-D.

The videogame industry has a lot riding on Nintendo’s launch. Sales of new videogame consoles in 2010 fell 13% to $6.29 billion from $7.19 billion a year earlier, according to market-research firm NPD Group. Sales have begun edging up in the past few months following the launch in November of Microsoft Corp.’s Kinect motion-controller for its Xbox 360 console.

The industry is facing competition from sleeker, lighter smartphones which offer good quality, downloadable games free or for a few dollars, much less than the average $40 price for each Nintendo 3DS game. While Nintendo has created products with 3-D capabilities since the mid-1980s, none have caught on. Nintendo 3DS is the result of improvements in screen technology and lower prices for these screens. The company, which is based in Kyoto, Japan, saw no apparent damage to its headquarters after the recent earthquake, a spokesman says. Business operations, including future product shipments, haven’t been affected, he adds.

Nintendo’s competitors aren’t jumping on the portable 3-D bandwagon quite yet. Apple has no intention of introducing a 3-D, portable display anytime soon, say people familiar with the situation. When Sony announced plans for its Next Generation Portable gaming device in January, the company confirmed this device wouldn’t have 3-D. A spokesman says Sony considered including 3-D during the development process for this device, but decided to focus on other features. A Microsoft spokesman says as consumer demand evolves for 3-D, the company is committed to evolving its technology. Both Sony and Microsoft offer 3-D games and movies in the living room via their PlayStation 3 and Xbox 360 consoles.

On March 27, 18 game titles will launch including Nintendogs + cats from Nintendo, and Madden NFL Football and Sims 3 from EA Sports. Almost all Nintendo DS games and DSiWare games will be playable in 2-D on the Nintendo 3DS.

Games that come loaded on the 3DS include Face Raiders and Nintendo 3DS Sound, which plays MP3 or AAC files and mixes your voice using funny sound effects. A Mii Maker program lets people make a Mii (personalized game character) with photos they take with the device. I created a particularly funny looking Mii with features that mirrored some of mine. But these Miis can’t be exported back to the Wii gaming console, where Miis first became popular.

Nintendo’s 3DS has cameras that capture 3-D photos for use in games.

Another cool game called AR Games lets users look through the 3DS cameras at six augmented-reality cards that come with the device. The cards make images more animated and three-dimensional. I found the effect so realistic, I reached out with my hand to make sure the imposed images, like a card with mini bull’s-eyes, weren’t actually on the table in front of me.

The 3DS has a few new features besides 3-D. A new circle pad works like a super flexible joystick for smoother navigation. Two outward-facing, stereo cameras take 3-D photos of friends or things, which can then be used in games. This made the games more personal and fun.

I used the 3-D photos I took in games like Face Raiders, which makes use of its motion and gyro sensors. The 3DS has an Internet browser, which wasn’t available on the device I tested. A Nintendo spokesman says it won’t work on devices until May. Also in May, Nintendo will start offering downloadable games for the 3DS.

Programs called SpotPass and StreetPass allow the 3DS to wirelessly receive or send data on the go even when the device is in sleep mode. SpotPass detects wireless hot spots so the 3DS can download free software, videos or game data. In late May, SpotPass will let users access AT&T’s Wi-Fi hot spots, free of charge. StreetPass lets one 3DS wirelessly exchange data with others within range (roughly 100 feet). A light on the 3DS indicates when the device has received new notifications.

The 3DS can perform other functions in sleep mode, like counting steps for a built-in pedometer. I carried the 3DS in my bag on several occasions throughout a conference and noticed a tiny icon of feet at the top of the screen with a number of steps beside it.

But the addition of 3-D technology to this device meant compromises on some key features. At eight ounces and 0.8-inch thick, the 3DS is slightly heavier and thicker than its comparable predecessor, the Nintendo DSi, which came out in 2009. (Apple’s iPod touch weighs less than half as much and is 0.28-inch thick.)

The 3DS’s estimated battery life is up to five hours while playing 3DS games, while regular Nintendo DS games will last up to eight hours. The DSi’s estimated battery life is up to 14 hours of game play. The 3DS is $100 more expensive than the DSi and its games are also pricier.

The Nintendo 3DS does a good job of incorporating 3-D with photos and games, as long as the games don’t make you feel dizzy. But its clunky form and limited functionality is up against steep competition from smartphones that cost less and offer more games.

Ian Sherr in San Francisco contributed to this article.

Write to Katherine Boehret at katie.boehret@wsj.com

]]> http://allthingsd.com/20110315/nintendos-3ds-brings-dizzying-fun-on-the-go/feed/ 0 http://allthingsd.com/20110120/kabam-raises-30-million-to-bring-serious-gaming-to-social/ http://allthingsd.com/20110120/kabam-raises-30-million-to-bring-serious-gaming-to-social/#comments Thu, 20 Jan 2011 12:30:47 +0000 Tricia Duryee http://emoney.allthingsd.com/?p=1786 Social games developer Kabam has raised a hefty round of funding to bring games to Facebook that appeal to a more traditional demographic–and probably not your mother. The capital will be used to expand its studios, release new titles and make acquisitions.

In a third round of capital, Kabam raised $30 million, led by Redpoint Ventures, with Intel Capital and Canaan Partners participating.

The Redwood City, Calif.-based company, which has such titles on Facebook as Kingdoms of Camelot, Dragons of Atlantis and Glory of Rome, is focused on developing massively multiplayer games like Activision’s super successful Call of Duty: Black Ops on Xbox.

As social gaming has ramped up, titles so far have been more mellow, focusing on attracting the largest audience possible. Therefore, many titles by category leaders like Zynga have had a wholesome flavor, focusing on activities in daily life, like farming and cooking. Typically, the games take only a few minutes per session, and users interact with friends when asking for goods or helping each other out on tasks.

However, Kabam has integrated more traditional features into its games, such as battles and fights, that require more strategy. It also allows players to interact with one another via real-time chat.

Kabam, which has been flying fairly under the radar, has 200 employees, up from 20 in the beginning of the year, and has additional studios in San Francisco, China and Germany. In October, it acquired Wonderhill, and this year it plans to launch more games, continue hiring and make additional acquisitions.

A $30 million round by investors signals that the social gaming market is still far from mature, with growth opportunities and niches still remaining–despite Zynga’s dominance and major acquisitions by some of the top game producers, like Electronic Arts and Disney, already having taken place.

]]> http://allthingsd.com/20110120/kabam-raises-30-million-to-bring-serious-gaming-to-social/feed/ 0 http://allthingsd.com/20110113/video-game-sales-lagged-in-2010-despite-xboxs-high-scores/ http://allthingsd.com/20110113/video-game-sales-lagged-in-2010-despite-xboxs-high-scores/#comments Fri, 14 Jan 2011 00:44:58 +0000 Tricia Duryee http://emoney.allthingsd.com/?p=1639 Microsoft’s Xbox dominated the charts at the end of 2010, despite year-over-year revenue declines for both videogame hardware and software.

The latest statistics released today from NPD Group estimated that consumer spending on game content totaled between $15.4 and $15.6 billion, which was flat to down 1 percent, compared to 2009. Meanwhile, sales of new physical videogame hardware, software and accessories were also down–6 percent, to end the year at $18.6 billion.

Microsoft was able to counteract those industry-wide trends through the successful launch of its Kinect hands-free controller and strong sales of the hit game Call of Duty: Black Ops.

Sales of the Xbox 360 jumped 42 percent year-over-year, and was the only platform to register an increase in unit sales. In fact, December 2010 was the best month ever for Xbox 360 sales after selling 1.9 million units.

After the figures were released today, Microsoft used the moment to toot its own horn: In a statement, it said it had pulled units from its January and February production to keep up with holiday demand for both Xbox and Kinect–and it still sold out in some circumstances. Now it’s scrambling to catch up.

At CES, Microsoft said that roughly eight million Kinects had been sold after being on the market for roughly two months, and that over 50 million Xbox 360s have been sold worldwide over the lifetime of the console.

The videogame industry is very cyclical, with software sales often trailing new hardware sales. Without new console introductions from the usual suspects, Microsoft has tried to increase sales by repositioning the Xbox as an entertainment hub, and relied on the Kinect to make the console appeal to a wider audience outside hard-core gamers.

Nintendo is hoping that its new 3DS gaming handheld will boost sales–however, it doesn’t come out for another couple of months, so it missed the critical holiday season and will face competition from smartphones.

NPD Group concluded that in December the Wii and the 360 platforms generated the greatest dollar sales of all platforms at 32 percent and 31 percent, respectively. That’s across all categories, including hardware, software and accessories.

Other than Xbox, there were some bright spots, but it wasn’t enough to offset overall declines. NPD Group said the highlights included digital downloads, mobile apps, social network games and non-digital stuff, like used games and PC games.

The numbers released today are early estimates. NPD Group said it will issue its final analysis in March.

]]> http://allthingsd.com/20110113/video-game-sales-lagged-in-2010-despite-xboxs-high-scores/feed/ 0 http://allthingsd.com/20110104/nintendo-records-high-scores-for-wii-and-ds-franchises/ http://allthingsd.com/20110104/nintendo-records-high-scores-for-wii-and-ds-franchises/#comments Tue, 04 Jan 2011 16:13:31 +0000 Tricia Duryee http://emoney.allthingsd.com/?p=1132 Now that the year has wrapped up, Nintendo is claiming to have broken two industry-wide records in 2010 to make its portable DS franchise and the Wii two of the best-selling game systems of all time.

The company said the portable DS handheld, which originally came out in November 2004, has sold an accumulated 47 million devices to become the U.S.’s best-selling videogame system of all time.

Additionally, the Wii sold more than seven million game consoles in 2010, marking the third consecutive year of such volumes–a feat Nintendo says has never been accomplished in the history of game systems.

The figures are impressive for the game company, which has always focused on a family-friendly niche, with lovable characters bouncing around in imaginary worlds, rather than on complex multiplayer games focused on violence and intense graphics.

But whether it will be enough to sustain the company against rivals such as the Xbox is unclear.

The Xbox has been the best-selling console for the past few months, a position that was supercharged in November when Microsoft released the Kinect, which allows users to play hands-free, similarly to how the Wii operates but taken to the next level.

Sales of the Kinect accessories have been strong, and have helped expand Microsoft’s audience beyond the hard-core gamer.

Nintendo is not expected to release a new console in the short term, and critics are unclear about the 3DS, which is the new portable handheld coming that boosts 3-D images without the need for glasses.

Nintendo said it’s coming to the U.S. in March, and more details will be available soon. Nintendo is attending the Consumer Electronics Show in Las Vegas this week for the first time in 16 years, but it’s not expected to make big news at the show.

But it’s unclear whether the 3DS can compete as a standalone gaming device as other multipurpose devices–like Apple’s iPhone and iPod Touch, as well as other smartphones–gain market share.

Nintendo of America President Reggie Fils-Aime begs to differ when forecasting the trends of the future: “When we look ahead to 2011, we see new portable technology and more great Wii games that need to be seen to be believed.”

If he does say so himself.

]]> http://allthingsd.com/20110104/nintendo-records-high-scores-for-wii-and-ds-franchises/feed/ 1 http://allthingsd.com/20110104/viacom-sold-rock-band-for-a-song-a-really-really-cheap-song/ http://allthingsd.com/20110104/viacom-sold-rock-band-for-a-song-a-really-really-cheap-song/#comments Tue, 04 Jan 2011 11:30:34 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=27558 Here’s what happens when a red-hot videogame franchise goes cold: You can buy the whole company for the same price as a single copy of the game.

I had a hunch that Viacom sold off Harmonix, which makes the Rock Band games, at a steep discount last month. But I’m still surprised it was this cheap: I’m told that investment group Columbus Nova paid $49.99–the list price for “Rock Band 3″–and got the entire company.

There’s more to the story, of course: People familiar with the transaction tell me Harmonix’s buyers also assumed the game company’s liabilities. That includes expensive music rights fees, and responsibility for lots of unsold games and equipment sitting on warehouse shelves.

And I’m told that the deal is structured in a way that will let Viacom net something like $150 million in tax benefits, similar to the AOL/Bebo fire sale last year. Given that Viacom paid $175 million for Harmonix a few years ago, things could be worse.

[UPDATE: The Los Angeles Times reports that Viacom will actually receive a $50 million tax benefit, and offload $100 million in liabilities. That makes more sense, and I've since confirmed it myself. My apology for the error.]

Still, it’s a fire sale price no matter how you look at it. And that can’t be comforting to Harmonix’s remaining employees, who are likely going to be facing a very serious restructuring.

Columbus Nova’s PR reps wouldn’t comment on the sale terms (neither would Viacom) but pointed me to an earlier statement from the company, which said it was “really excited about backing the world-class team that has consistently produced such great games and helping them grow the company and its brands.”

]]> http://allthingsd.com/20110104/viacom-sold-rock-band-for-a-song-a-really-really-cheap-song/feed/ 0 http://allthingsd.com/20101215/trialpay-brings-advertising-to-the-online-check-out-line/ http://allthingsd.com/20101215/trialpay-brings-advertising-to-the-online-check-out-line/#comments Wed, 15 Dec 2010 13:55:01 +0000 Tricia Duryee http://emoney.allthingsd.com/?p=678

TrialPay is bringing the concept of enticing shoppers with the latest tabloid magazine, a pack of gum or a Snickers bar from the line at the grocery store to the online checkout world.

However, there’s a twist: If you bite, you’ll also get a discount on your original purchase.

Up until now, the Mountain View, Calif.-based company’s offers were most likely seen by people playing Facebook games.

Through a fairly exclusive partnership with Facebook Credits, TrialPay can offer a virtual good for free if a player considers buying another deal, like a cup of Starbucks coffee or a Chipotle Mexican Grill burrito.

TrialPay’s founder and CEO Alex Rampell explains that Starbucks or Chipotle pays TrialPay for the sales lead, and TrialPay pays FarmVille. Rampell said it’s a system consumers are comfortable with, because they are often buying physical goods, rather than intangible goods.

TrialPay’s new service, which is coming out of a long beta today, is bringing these alternate payment options to the online shopping cart. The goal is to convert more sales before they are abandoned at the point of sale.

One of its guinea pigs was MediaMall Technologies, which sells online streaming TV subscription packages. It offered customers a $15 discount on its PlayOn Premium software (normally $40) in return for signing up for a particular offer.

One such offer required users to also sign up for a GameFly subscription, which sends videogame rentals to your door, or a RealPlayer SuperPass.

Rampell said MediaMall immediately saw a 10 percent increase in revenue and a dramatic increase in average order value. The increase in average order value was due to the fact that it received a bonus commission based on every in-cart offer completion.

TrialPay is calling it a hosted shopping cart because it also handles the various payment systems, including PayPal and credit cart providers, on behalf of the retailer.

]]> http://allthingsd.com/20101215/trialpay-brings-advertising-to-the-online-check-out-line/feed/ 0 http://allthingsd.com/20101130/kinect-score-2-5-million-down-2-5-million-to-go/ http://allthingsd.com/20101130/kinect-score-2-5-million-down-2-5-million-to-go/#comments Tue, 30 Nov 2010 11:00:04 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=53294

Microsoft’s Kinect videogame motion sensor passed the one-million-sold milestone after just 10 days at market. And now, 15 days later, it’s passed another: 2.5 million sold in 25 days.

That’s 100,000 units sold per day.

Evidently, already strong demand for the device grew stronger still over the Black Friday weekend, so much so that there’s little doubt that Microsoft will hit the aggressive sales forecast it set for the device at launch. Said Don Mattrick, president of Microsoft’s Interactive Entertainment Business, “With sales already exceeding two and a half million units in just 25 days, we are on pace to reach our forecast of 5 million units sold to consumers this holiday.”

Below, video of Microsoft showing off Kinect at D8.

]]> http://allthingsd.com/20101130/kinect-score-2-5-million-down-2-5-million-to-go/feed/ 0 http://allthingsd.com/20101123/xbox-kinect-review/ http://allthingsd.com/20101123/xbox-kinect-review/#comments Tue, 23 Nov 2010 23:26:29 +0000 Katherine Boehret http://solution.allthingsd.com/?p=1527 This holiday season, the war against couch potatoes wages on with Microsoft’s Xbox Kinect, the latest in motion-sensing video-game consoles. While the Nintendo Wii and Sony PlayStation Move encourage people to stand and play games using familiar gestures and simple controllers, Kinect encourages people to motion their way through games and screens using their bodies as controllers.

Kinect (xbox.com/kinect), a rectangular strip of four microphones, a 3-D sensor and a video camera, is $150 for those who own the Xbox 360. It’s sold in a $300 bundle with the 4-gigabyte Xbox 360 console; $400 with a 250-gigabyte console. (Sony’s PlayStation Move is $100 without the console and $400 when bundled with the 320-gigabyte PS3; Nintendo’s Wii costs $200.)All packages include the Kinect Adventures videogame. There are currently 17 games that work with Kinect, and each costs $50, $10 less than a standard Xbox game.

Kinect can sit on top of, below or beside the TV, plugging into a wall power outlet and the Xbox via a USB cord.The concept used by Kinect has potential far beyond games and might even become a new way of controlling computers of all kinds.

Thirteen of the 17 available Kinect games are rated E for Everyone, and the remaining four are rated T for Teens—a sign that Microsoft is going after a different crowd with Kinect than with its regular Xbox games, which offer a wide range of ratings, including violent games.

It automatically identifies who you are and pauses when you leave its vicinity, so it isn’t hard to imagine this ingenuity controlling all kinds of devices, like a PC, smartphone or tablet.

Over the past few weeks, I played a variety of Kinect games with three other people in the room, one other person in the room and completely by myself. I tried it with a 46-inch, 1080p LCD TV as well as using an old standard-definition TV.

My experiences were mixed. Kinect works beautifully for activities that involve only your body, like exercise classes, running, jumping hurdles, yoga and dancing, with the moves feeling natural and fun. The motion sensor detects even slight movements to reflect what you’re doing on the TV screen. I battled my boyfriend in Dance Central while busting out dance moves called Double Dig ‘Ems and Headwrushes. I sprinted down a virtual track, running in place fast enough to earn a game world record. And I toned my arms and abdominals while punching floating boxes in the Your Shape’s kickboxing class.

But when it came to sports that involved holding or throwing objects like bowling, volleyball or discus, Kinect started to feel a little inauthentic, like I didn’t really have control over the object. When I threw a discus far enough in Kinect Sports to prompt the game’s commentator to shout, “Is that discus a part of the space program?” I didn’t know what I did to get that result.

The same was true for driving a car in Kinect’s Joy Ride game: Players are instructed to hold their hands like they would if they were gripping a steering wheel, turning left or right by moving hands accordingly and leaning back and quickly forward to get a burst of speed. But it’s hard to mimic a motion to accelerate, and I found myself jerking my body all around to get results. My arms also got tired after holding them up for awhile.

Other games, like Kinectimals and Kinect Adventures, play to the Kinect’s strengths by using broader gestures and fewer accuracy-focused tasks. With Kinectimals, I moved my hands to virtually scratch a Bengal tiger cub; the cub even became more familiar with me the more it listened to my voice. I rode a raft in Kinect Adventures by leaning left or right to steer through rapids, jumping up to grab on-screen coins for points and ducking to avoid getting clocked in the head with objects.

Dance Central

In certain games, two people can play simultaneously standing in front of Kinect. The system can identify and sign in up to eight people as they step in and out of play. It recognizes those who are signed into Xbox and playing, so only their gestures maintain control of navigation. Its sensor will identify and log you in a few seconds after you step in front of it. If you walk away in the middle of a game, Kinect will sense that you aren’t there and will pause the game.

Kinect isn’t yet fully integrated into the entire Xbox navigation system. Some tasks still require the old Xbox controller, like opening the Xbox Guide, a quick way of launching anything in the system. Xbox’s Dashboard, which is the first menu you see when you turn on the system, also requires the controller. The Dashboard is separate from Kinect Hub, which lets you use your voice and gestures to do things like opening the system’s disc tray, selecting menus or even pausing a movie—just by saying, “Xbox, pause.” A spokesman said Microsoft plans to integrate these commands throughout the Dashboard. For now, it’s tempting—but futile—to want to use voice and gesture on every screen.

Many Kinect games capture videos of you as you play games and then play them back for you at the end. The results are hilarious. Kinect Adventures gives you a heads-up so you can make an extra silly pose at the right moment. Kinect Sports compiles a highlight reel as you go, playing this video back at the end of your athletic events, goofy sport gestures and all. And Dance Central announces a freestyle dance for all players at the end of each round, capturing video snippets of these moves. Users who are signed into Xbox Live can share these videos with others.

Kinect Adventures

Kinect can also be used to video chat with anyone who’s using Windows Live Messenger and a webcam.

I really enjoyed Dance Central—and not just because I won most of my dance battles (the one who gets the most moves correct wins). This game offered a large variety of songs ranging from old-school rap to Lady Gaga. Each dance was taught in a different virtual venue by an instructor who shouted words of encouragement or instruction, and cheers from the crowd spurred me on.

Navigating the menus in Kinect games is usually more enjoyable with gestures, though it takes a little longer than if you were pressing a controller button to skip ahead. In the Your Shape game, I selected from Personal Training, Fitness Classes and Gym Games using my arm to touch my selection and another red icon below that to confirm it. When I started this game, the sensor scanned my body to measure my height, arm length, leg length and shoulder span, thus customizing games just for me.

In the future, Kinect could use be used to recognize communities like a group of fans all wearing the same team colors while watching a game, in which case the system might display extra on-screen data for that supported team. Another example could include playing along with game shows from home, like reality TV for the masses.For now, Xbox Kinect does well with many games that mimic real-life gestures and motions. Games with specific actions using objects, like rolling a bowling ball, need work to feel more authentic.

Edited by Walter S. Mossberg

Email mossbergsolution@wsj.com

]]> http://allthingsd.com/20101123/xbox-kinect-review/feed/ 0 http://allthingsd.com/20101028/another-wiif-for-nintendo/ http://allthingsd.com/20101028/another-wiif-for-nintendo/#comments Thu, 28 Oct 2010 16:51:29 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=51591 Nintendo warned last month that its first-half results would be lousy, and this morning the company delivered on that promise, posting its first half-year loss in seven years.

For the six months to September 30, the Japanese gaming giant reported a $24.7 million loss as sales of hardware and software slipped. Nintendo sold 6.69 million DS units during the half, down significantly from the 11.7 million it sold during the same period last year. And it sold fewer Wiis as well–4.97 million, down from the 5.75 million it shipped last year. On the software side, things were equally dismal. DS software sales declined to 54.84 million units from 71.15 million units in 2009; Wii software sales fell to 65.21 million units from 76.21 million units in the same period a year earlier.

The beginnings of an ugly trend for Nintendo, which is fast losing momentum in a motion-enhanced gaming market in which its rivals are gaining it. With Sony’s PlayStation Move motion controller already at market and Microsoft’s Kinect for XBox 360 (Project Natal) headed there next month, it is becoming increasingly clear that the Wii–now about four years old–needs a full-on refresh.

]]> http://allthingsd.com/20101028/another-wiif-for-nintendo/feed/ 0 http://allthingsd.com/20101028/viral-video-tron-legacy-daft-punks-derezzed/ http://allthingsd.com/20101028/viral-video-tron-legacy-daft-punks-derezzed/#comments Thu, 28 Oct 2010 07:13:48 +0000 Kara Swisher http://kara.allthingsd.com/?p=36417

The music video for this original song for the Disney movie sequel, which is essentially about being inside a really cool videogame with mean people. In 3-D. Riding wild motorcycles. And wearing weird glowing catsuits.

Which is what BoomTown does every weekend.

It opens Dec. 17.

And don’t miss British actor Michael Sheen channeling David Bowie.

Enjoy:

]]> http://allthingsd.com/20101028/viral-video-tron-legacy-daft-punks-derezzed/feed/ 1 http://allthingsd.com/20100514/videogame-sales-crater/ http://allthingsd.com/20100514/videogame-sales-crater/#comments Fri, 14 May 2010 13:50:08 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=40620

April was another lousy month for the videogame industry. With overall revenue down 26 percent and hardware down 37 percent, it was the worst monthly year-over-year sales decline since last July, according to research house The NPD Group. It was also the 10th time in the last 13 months that sales have fallen year-over-year.

• Nintendo sold 277,2000 Wiis, down from 557,500 in March and 340,000 a year ago. The company sold 440,800 Nintendo DS’s, down from 700,800 in March and 1.04 million a year ago.
• Microsoft sold 185,400 Xbox 360s, down from 338,400 in March, but up from 175,000 a year ago.
• Sony sold 180,800 PlayStation 3s, down from 313,900 in March, but up from 127,000 a year ago. And it sold 65,500 PSPs, down from 119,900 in March and 116,000 a year ago.

What’s driving the drops? Blame the portable gaming industry, which contributed more than its fair share to the industry decline, said NPD analyst Anita Frazier.

“The portable business across hardware, software and accessories accounted for 25 percent of total industry dollar sales in April,” Frazier explained. “But declines in portable sales compared to April ’09 accounted for 61 percent of the total industry decrease.”

That’s just abysmal, even if April is traditionally the slowest month of the year for videogame sales. Consider this: At 440,800, sales of the Nintendo DS tanked by more than 50 percent from more than one million last April.

So what’s going on? Perhaps consumers are postponing new portable game system purchases in anticipation of Nintendo’s new 3DS. Or perhaps they’re finding that their smartphones make fine gaming devices.

It’s not yet clear. But what is clear, and painfully so, is that the hardware refresh promised by Sony (SNE) and Microsoft (MSFT), which are adding new motion technology to their players, and Nintendo, which is debuting the 3-D version of its DS handheld, can’t come soon enough.

]]> http://allthingsd.com/20100514/videogame-sales-crater/feed/ 0 http://allthingsd.com/20100512/aloha-ipad/ http://allthingsd.com/20100512/aloha-ipad/#comments Wed, 12 May 2010 12:00:14 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=19322 It’s not Android-outselling-iPhone, but it’s good enough to be the Apple stat of the morning: The iPad is big in Hawaii!

Or at least it was in the first week it hit the market in April. That’s according to JiWire, a mobile marketing company with a very particular niche: Selling ads via commercial Wi-Fi networks.

JiWire tracks device information from the 30,000 public Wi-Fi hotspots where it serves ads, and it says Apple’s (AAPL) tablet made an immediate impact on its network, accounting for 1.53 percent of ad requests.

And for some reason, a bunch of them came from Honolulu. Go figure:

Meanwhile, here’s a more consequential data set from JiWire’s Q1 report on the most popular handsets and operating systems on its network (click to enlarge):

Most of those entries aren’t terribly surprising: Apple’s iPhone and iPod dominate the lists, and Google’s (GOOG) Android has a strong presence, too. The one that might raise an eyebrow is Sony’s (SNE) PSP game unit, which I confess, I never think of as an ad platform.

But mobile ad executives tell me they do, in fact, move a lot of inventory on the gadget. Think of the kinds of advertisers who buy time on Smackdown–armed forces, energy drinks, and other videogames–and you’ve got a sense of the PSP’s buyers.

And now you’ve learned two interesting tidbits in one story! Let’s go for three, via this electricity primer:

]]> http://allthingsd.com/20100512/aloha-ipad/feed/ 0 http://allthingsd.com/20100506/nintendo-wiifs/ http://allthingsd.com/20100506/nintendo-wiifs/#comments Thu, 06 May 2010 11:43:48 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=39906 Surging sales of its Wii and DS led Nintendo to three straight years of record profits. But with the appeal of those devices now waning, the company needs to refresh them both lest it continue to post financials like those it announced today.

This morning, the videogame company reported its first full-year drop in revenue in six years, one in which revenue fell 22 percent to 1.43 trillion yen and operating profit dropped 36 percent to 356.57 billion yen.

Driving the declines: Wii sales that were down 21 percent year-over-year to 20.53 million. With global sales of the console expected to fall again this fiscal year–to 18 million units–the company is in desperate need of something to revive them.

Though it still leads in this generation of gaming hardware, Nintendo is struggling to maintain its momentum. With rivals like Microsoft (MSFT) working on Project Natal and other innovations, it is becoming increasingly clear that the Wii, now about four years old, needs a full-on refresh and not just new peripherals like the silly vitality sensor the company showed off last year.

With Apple’s (AAPL) iPhone and iPad making big inroads in portable gaming, the new 3-D version of the DS Nintendo is planning can’t come to market soon enough, though the company’s executives insist it’s holding its own.

Said Nintendo of America President and COO Reggie Fils-Aime: “We have not seen any impact on our DS business [from the iPad]. In the first three months, we’ve set two new sales records for the Nintendo DS. We think that through April, we’ll have the best four-month time period to kick off a new calendar year that we’ve ever had with the device. So we’re certainly seeing momentum, they’re seeing momentum–I think two products can succeed at the same time.”

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