“Consumer demand continues to be uneven, concentrated among Nintendo products (Wii and DS), Xbox 360 hardware bundles, and a limited number of core software titles (e.g., Call of Duty and Gears of War 2) amid a congested slate of high-quality releases,” he says.

Software sales, Sebastian says, are still well on track to clock a minimum 20 percent growth for 2008 — beating analyst targets set at the beginning of the year.