Microsoft "Kinects" with its competitors

Kinect for Xbox 360

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JEREMY HOBSON: A new study shows video game sales are up eight percent since last month. The NPD Group report could be good news for gaming companies, as they head into the holidays.

But as Marketplace's David Gura reports the profits may not get split evenly.


DAVID GURA: Last month, shoppers got to Kinect. That's not spelled how you think it is. It's K-I-N-E-C-T. The accessory for the Microsoft Xbox 360 hit the market in November. And this season, it's the it gift for gamers. The kinect a very small box, packed with motion-recognition software and a 3D camera.

It costs about a $150 bucks.

In November, Microsoft unloaded 2.5 million Kinects worldwide. That's enough to give one to every resident of Toronto, Canada. The company says it expects to sell 5 million by the end of the year. That's a big deal for Microsoft, which for a while has been trying to catch up to its competitors. For the sixth straight month, the Xbox outsold those competitors -- the Sony Playstation 3 and the Nintendo Wii.

So, what does this mean for Sony and Nintendo. Is this a zero-sum game? Analyst Arvind Bhatia with Stern Agee says no.

ARVIND BHATIA: The amount of time people have been spending on video games has gone up.

And perhaps more importantly to Microsoft, the amount of money they're spending on them has gone up too.

In Washington, I'm David Gura, for Marketplace.

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