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: Is it any surprise that an industry that enables its customers to escape from reality into elaborate fantasy worlds is thriving in today’s gloomy economic climate? As other industries collapse, sales of video games are racing away. Global sales of console hardware and games software are expected to hit a record $49.9 billion this year, says Screen Digest, a consulting firm. Games sales in America in October totalled $697 million, 35% more than a year earlier, according to NPD, a market-research firm. It is often said that video games are recession-proof. Are they really?

Video gaming is isolated from the wider economic cycle by having a cycle of its own. Every few years a new crop of consoles is launched, spurring a wave of sales as gamers upgrade. (Today’s set consists of Microsoft’s Xbox 360, launched in 2005, and Sony’s PlayStation 3 and the Nintendo Wii, which both appeared in 2006.) During the cycle the prices of the consoles fall, bringing in more buyers. Each cycle is bigger than the last as gaming becomes more popular and the average gamer becomes older and richer.

The industry has another layer of recession-proofing in that its biggest-spending customers are typically young men (the average gamer is around 30) with high disposable incomes who regard gaming as an important part of their lives, rather than a form of discretionary spending, says Piers Harding-Rolls of Screen Digest. There was no sign of weakness during America’s previous recession, in 2001, he notes, though the industry was smaller than it is now.

Now that gaming has become more popular—a survey by the Pew Internet & American Life Project found that 53% of American adults play video games of some kind, for example, along with 97% of teenagers—it seems to be doing well despite the economic downturn for an extra reason: it offers a relatively cheap form of entertainment that can be consumed at home. Alex Evans of Media Molecule, the British studio behind ‘LittleBigPlanet’, a popular PlayStation 3 game, says people in the industry believe gaming has benefited from the rise of the ‘staycation’, or stay-at-home holiday. It is much cheaper to escape into the world of ‘Fable II’ for a week than to go abroad.