Video game industry has turned corner: EA

By Scott Hillis

NEW YORK (Reuters) - The video game industry has turned a corner after a lengthy hardware transition, with new console purchases expected to reach 200 million units in five to six years, the head of Electronic Arts Inc (ERTS.O: Quote, Profile, Research, Stock Buzz) said on Thursday.

"It's been the longest, hardest transition in the history of the industry," EA Chief Executive John Riccitiello told the Reuters Media Summit in New York.

"Last Friday marked one of those points where you can say something's changed," he said. "Around the world, based on the data I've got, it was pretty clear that the transition is now over.

Key to that was Sony Corp's (6758.T: Quote, Profile, Research, Stock Buzz) recent price cut for its PlayStation 3, which should ensure the struggling console hits the company's fiscal-year sales target of 11 million units, Riccitiello said.

Since its launch a little more than a year ago, sales of Sony's PS3 have lagged those of Nintendo Co Ltd's (7974.OS: Quote, Profile, Research, Stock Buzz) Wii and Microsoft Corp's (MSFT.O: Quote, Profile, Research, Stock Buzz) Xbox 360.

But in a sign of changing fortunes for the PS3, U.S. sales jumped in the weeks following a mid-October price cut and launch of a lower-priced version. Sony said this week that PS3 sales on "Black Friday," the day after Thanksgiving that is a big U.S. shopping event, more than tripled from a year before.

"It looked like it might have been a two-horse race, but it's clearly a three-horse race," Riccitiello said of Sony's revitalized sales. "I think from this point, pleasantly for me, it's sort of fat city in the game industry."

Separately on Thursday, Microsoft said it had sold more than 310,000 Xbox 360 units during the week of Thanksgiving, nearly as many as it sold in the whole month of October.  Continued...