Video games sales to top CDs and DVDs

Video games are predicted to become the UK's most popular form of entertainment this year, it was reported today.

UK consumers are expected to spend £4.64bn on video games in 2008 - an increase of 42% - with music and video sales accounting for a total of £4.46bn, analysts from Verdict Research told the BBC.

According to research, the video games market has more than doubled in value in the last five years, with the popularity of new titles such as Grand Theft Auto IV and FIFA 08 and the Nintendo Wii contributing to the massive growth.

However, the Entertainment Retailers Association (ERA) told the BBC the figures may prove misleading because they include sales of games hardware as well as software.

Steve Redmond, of the ERA, said: "There is no doubt that the games sector is having a fantastic year. But these figures overstate that by including games hardware.

"Our prediction is that games will overtake video by the end of this year, but not music and video combined."

The ERA's 2007 figures put games software sales at £1.7bn, and revenues for music at £1.4bn and video at £2.2bn.

But a shift in consumer behaviour towards buying CDs and DVDs online means high street retailers are in for tough times, Verdict Research said.

Digital downloads only make up around 4% of music and video sales.

Malcolm Pinkerton of Verdict Research told the BBC: "The music and video market is not just suffering from a slowing of growth but a massive transfer of spend to online."

He said high street music retailers such as HMV and Zavvi were having to adapt to a difficult climate.

"They're cutting back on space in music and re-allocating it to more lucrative areas such as MP3 players, books, clothing and video games."