IF there was any doubt as to whether the consumer market was ready for a third wave of gaming platforms, they’ve been resoundingly silenced by the category’s performance in 2006. According to retail sales tracker The NPD Group, the video game industry brought in US$13.5 billion last year, beating 2005’s tally by 18% and setting a new record for annual revenues in the category.

The growth was unequivocally driven by the launch of PS3 and Wii, as well as Xbox 360, which launched at the end of ’05 but continued to sell well last year. As a result of these hot entries, console hardware sales finished up a whopping 88%.

And since heat in hardware tends to have a warming effect on software too, it’s not surprising that game sales were up by 6%. Although Madden NFL Football (Electronic Arts) was the best-selling console game of ’06, the top five included three kids/family entries, with THQ’s Cars sitting in second, Lego Star Wars II: The Original Trilogy from LucasArts in third, and Nintendo’s proprietary NDS title New Super Mario Brothers in the fifth spot.

NPD also recently took a look at kid usage of electronic devices and the dynamics behind how they acquire digital content. On any given day, kids ages two to 14 average 44 minutes playing games on video game systems, and the same amount of time listening to music on portable digital music players (PDMPs). Highlighting the proliferation of consumer electronics and the trickle-down effect that eventually shapes usage of all technologies, the study found that 15% of two- to five-year-olds use cell phones.

By the age of seven, more than one in 10 kids is downloading some form of content, and this number jumps to 22% by age 10 and 50% by 14. The report also reveals that most kids are paying for online content, despite the availability of freebies. A full 70% of PDMP users are paying for music; as are 55% of computer users, 67% of cell phone users and 87% of video game users.