Wii's Magic Doesn't Rub Off on Game Makers

Nintendo's best-seller Wii is so hot it can't stay long enough on retail shelves for consumers, but video-game publishers are still waiting for some of the console's magic to rub off on them.

Early holiday season sales of the top 10 best-selling video games show that, with the exception of Activision's(ATVI Quote) Guitar Hero III title, consumers are not buying games for the Wii from other publishers but Nintendo.

The latest sales data will likely fuel concerns that big-name game makers are unlikely to profit from the strong demand for the Wii.

So far, many investors have been looking into the product portfolio of companies such as Electronic Arts(ERTS Quote), Activision, THQ(THQI Quote) and Take-Two(TTWO Quote) in a bid to understand their game development efforts for the Wii.

But early holiday sales numbers from research firm The NPD Group indicate Wii buyers are not active consumers of video games.

Instead, investors looking to understand how game publishers will fare with their titles may be better off following Microsoft's(MSFT Quote) Xbox 360.

Four of the top 10 games in November are for the Xbox 360, compared to three for the Wii and two for the PS3. The tie or attach ratio -- that is, the average number of games sold per console -- for the Xbox 360 stands at almost twice that of the Wii.

The Console-Game Disconnect

"Most consumers by the end of the hardware cycle will own a Wii and one of the other systems, either a Xbox 360 or a PlayStation," says Jesse Divnich, an analyst with the online video-games prediction market, The simExchange. "Most video gamers are going to own a Wii because it is cheap, innovative and a fun system, but I expect the Xbox 360 to have the highest tie in ratio for games."

The disconnect between sales of the Wii and games for the console by independent publishers for the system may have to do with the kind of buyers that the Wii is attracting.

Historically, buyers of video-games consoles tended to be a group of largely young, enthusiastic gamers.