Console shipments wane as gaming phones ascendant

Growth of console hardware appears to have slowed, according a new report by analyst iSuppli.

Factory shipments on home consoles increased by a relatively minimal 0.2 per cent from last year - the estimate claiming it would 52.3 million in 2010 compared to 52.1 million in 2009.

However, it felt the advent of Kinect and Move, plus projected next-generation devices within two years, would stave off an active decline for now.

Handheld devices are projected to decline however, with factory units dropping 2.5 percent from 39.9 million to 38.9 million.

By contrast, iSuppli claimed that shipments of mobile phones rather broadly deemed "equipped to play games and other forms of electronic entertainment" had risen by 11.4 per cent to 1.27 billion.

While the multi-function nature of these handsets means they should perhaps not be considered direct console rivals, the figures give some indication of how electronic consumers' money is currently being spent.

"The formidable lead enjoyed by cell phones capable of gaming will continue in the years to come with no hint of decline, and their near-universal presence gives them the potential to become a viable competitive threat to dedicated gaming platforms, primarily handheld devices," said Pamela Tufegdzic, the report's author.

The iSuppli analyst prescribed this perceived problem to console hardware reaching the mature part of its lifecycle, and to high prices and the economic climate continuing to deter upgrades.

"Although gamers who prefer a superior gaming experience will always opt for either a console or handheld, sales of both platforms tend to rise and fall based on the vagaries of product development, consumer buying patterns and economic trends."

The report also claims some consumers are deterred from current systems because they feel next-generation devices are imminent. It projects new hardware as soon as late 2012, and estimates that console shipments will increase to 59.9 million by 2014.