* Hardware sales down 6 pct, software sales up 5 pct
* Sony Playstation 3 is top-selling console for first time
* Industry sales total $1.28 billion
* First month of growth in a half-year (Recasts top, adds CEO and analyst quotes, background)
By Ian Sherr
SAN FRANCISCO, Oct 19 (Reuters) - Price cuts helped Sony Corp's (6758.T) Playstation 3 become the top-selling video game console for the first time since its release, as U.S. sales of video game gear and software in the United States rose a modest 1 percent in September from a year ago, a research group said on Monday.
The PlayStation 3 dethroned long-running champ Nintendo 7974.OS and its Wii console to take the top spot, according to NPD. Microsoft's (MSFT.O) Xbox 360 came in third.
"If they didn't have the price cut, it wouldn't have happened," said Wedbush Morgan analyst Edward Woo, noting the PS3's $200 in price cuts over the past two years [ID:nN27330202].
Overall, U.S. game hardware sales fell 6 percent from a year ago, while software sales rose 5 percent, NPD said. Sales of video game accessories rose 2 percent, and total sales across the industry rose 1 percent to $1.28 billion.
"One percent growth in this extremely challenging economy is pretty positive," said Sony America's Chief Executive Jack Tretton, noting the industry's decline between March and August. "To be talking about a sector of the economy that's growing at all is certainly an endorsement of the success the category has had."
Nintendo's Wii also saw a recent price cut which helped boost sales 67 percent compared to the prior month, according to company data. Sony said sales of its Playstation 3 grew 134 percent versus August.
The top video game was the XBox 360's Halo 3:ODST, with the second and third-place spots taken up by Madden NFL for both the XBox and PS3, as well as Wii Sports Resort.
The industry has been mired in a slump as U.S. consumers continue to spend cautiously, leaving hardware sales down 16 percent when compared to the prior year and software sales down 12 percent. But long-awaited console price cuts and new games are expected to boost sales in coming months. (Editing by Lincoln Feast)