Ubisoft sees game industry peak in 2009

By Scott Hillis

SAN FRANCISCO (Reuters) - Video game companies will have a tough time topping 2007's spectacular growth, but the industry won't hit its cyclical peak until next year, a senior executive with France's Ubisoft (UBIP.PA) said on Wednesday.

"Stronger financially is going to be difficult. It was a good year last year," Laurent Detoc, Ubisoft's president for North America, said in an interview when asked if 2008 would be as strong as 2007.

Europe's largest games publisher, Ubisoft has titles such as "Assassin's Creed" and military-themed games created with political thriller author Tom Clancy. The company said last month that its fiscal 2008 revenue jumped 36 percent to $1.5 billion.

Detoc said console makers -- Nintendo Co Ltd (7974.OS), Microsoft Corp (MSFT.O) and Sony Corp (6758.T) -- were poised to sell more hardware than ever, up to 36 million units this year alone.

"I don't even think this is the peak. The peak could be next year," Detoc said.

Detoc spoke a day before market research firm NPD is to release April game sales data for the United States. Sales of gaming hardware, software and accessories rose 43 percent in 2007, and the industry has carried that momentum into this year, with March sales soaring 57 percent from a year earlier.

Detoc said the concern is whether new console buyers, which include a lot of first-time older and female gamers drawn to Nintendo's Wii, can be enticed to keep buying new games.

"I'm a little cautious right now in terms of hardware and how that translates to software," Detoc said.

Concerns about the economy and consumer spending shouldn't weigh on the industry, which last boomed early in the decade even as the Internet bubble burst around it.

Asked if he thought the industry was recession-proof, Detoc said: "I hope it doesn't sound silly but I do. The cycle of the industry is so much more powerful than the economy."

"It's true that when you have very good products, customers come and buy," Detoc said. "If you don't have good product right now, you are not doing well, regardless of the economy."

There was no sign yet that hardware makers would have to cut prices, thanks in part to blockbuster games like "Grand Theft Auto 4" from Take-Two Interactive Software Inc (TTWO.O) that sold 6 million copies in its first week and has driven demand for new console.

Take-Two is the target of a $2 billion takeover bid from Electronic Arts Inc (ERTS.O), and Detoc said the huge revenue pulled in by top games would draw acquisition interest from other media companies hungry for growth.

"This industry is very attractive to people who are not in it," Detoc said. "They want in because they see which way the wind is blowing."

(Reporting by Scott Hillis, editing by Richard Chang)