According to ELSPA there's no decline in the industry:

The world market for video games is growing at a faster rate than ever before, according to a new report by analysts Screen Digest on behalf of ELSPA, the Entertainment and Leisure Software Publishers Association. The popular games console systems, Sony PlayStation 2 and Microsoft Xbox have sold 30 per cent more than the previous generation of gaming technology at the equivalent point in time.

In the UK, spending on the leisure software market in 2002 was double the size of the British video rental market and 1.4 times more than cinema box office spending. Games hardware sales in 2002 were also up 44 per cent, accounting for 3.3 million units in the period.

Ben Keen, research director of Screen Digest, commented: "The current technology cycle of the games market is playing out at an accelerated rate compared to previous market phases. In addition, more games are being sold for every console purchased. This means that hit titles will sell in ever greater numbers."

The UK continues to be the largest market in Europe and the third largest market in the world, after the US and Japan. Total UK leisure software sales grew again in 2002 to reach £1,081m (EUR1,612m) - the highest value ever reached. Since 1995, more than 215m units of leisure software have been sold in the UK. That is enough for every household in Britain to own almost nine titles each. Across Europe, a staggering 900m-plus games or edutainment CD-ROMs will have been sold over those eight years. Across the world, the total number of leisure software units sold since 1995 is nearly 3 billion.

According to the new report, the world market for games and edutainment/reference software will grow to $18.5bn this year, up from $16.9bn in 2002. Since 1995, the global leisure software market has almost tripled in value, and there are few - if any - other media markets that can show comparable growth.