The NPD reported last week that retail video game sales were down. Gamasutra's analysis of 2010's NPD numbers offers a bit more context to this claim, in handy chart form (above). Total revenue rose pretty steadily between 2005 and 2008, and then started slipping downward.
Even accounting for digital distribution, according to the NPD, the industry's revenues still don't show growth. "The NPD Group estimates that total consumer spending on games in 2010 was essentially flat from 2009," the Gama article notes, "even when extra-retail sources like digital distribution and social games are considered." Should revenue shrink this year, it will "probably be the longest such contraction in the last 20 years of the video game market."
One area that didn't contract, of course, was the Xbox 360, which experienced its best month ever in December. In 2010, the Xbox 360 made great strides toward catching up with the Wii, "falling short by only 305,000 units."