Video game software was the UK's most valuable entertainment retail category in 2011, overtaking video for the first time.
According to data released by the Entertainment Retailers Association, revenue generated by boxed retail, digital downloads and apps hit £1.93 billion last year, versus£1.8 billion for video and £1.06 billion for music. Digital game revenue hit £504 million, versus £333 million for music and just £97 million for video.
Games represented 40.2 per cent of entertainment retail in 2011 - ahead of 37.6 per cent for video. The report notes that physical video sales have doubled that of games in the first 12 weeks of 2012, though historically the games industry generates the vast majority of its revenue later in the year.
"This is a dramatic time for the entertainment market. It is an historic development for the games sector to have overtaken video last year. Video has long been the biggest entertainment sector," said ERA director general Kim Bayley.
Overall, combined sales of games video and music fell 3.3 per cent year-on-year to £4.8 billion.