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Summer swoon hits game box sales

Sales of game consoles slid in July, according to new figures, suggesting that the box-boosting effect of recent price cuts has started to wear off. Or is the droop just seasonal?

The sales impact of game-console price cuts began to wane in July, according to data from market researcher NPDFunworld.

NPD figures show that average weekly sales of consoles in the United States dropped to 316,000 units in July, from 403,000 units per week in June, according to a report by Merrill Lynch, which cited NPD's numbers.

Sony cut the price of its PlayStation 2 game console from $299 to $199 in May, a move that was soon mirrored for the Xbox by Microsoft. Nintendo followed by cutting the price of its GameCube from $199 to $149.

The price cuts were credited with driving a major jump in sales for each system. NPD had recorded sales of 188,000 units per week in April.

Merrill Lynch analyst Justin Baldauf said the sales drop in July, typically the slowest time of the year for the game industry, was smaller than expected.

"The rate of decline...was modest in our opinion, and hardware sales continue to outpace levels seen before the price cuts implemented (at the) end of May," he wrote. "In our view, the July data suggests that overall demand for video game products remains robust."

July sales of game software were down about 16 percent month-over-month, according to NPD. Electronics Arts' "NCAA Football 2003" was the top seller for the PlayStation 2 and the Xbox during a slow month for new game releases, but competition is expected to heat up this month with the release of hotly contested new NFL games.