Updated: Nintendo keeps whoopin’ its console rivals, gamers spend their last dollars on games

In video games, at least, there was no recession in March. The NPD Group reports that U.S. video game hardware, software and accessory sales rose 57 percent to $1.7 billion during the month compared to a year ago.

Nintendo dominated U.S. video game console sales in the month of March, keeping its lead in the three-way console battle, NPD said.

Nintendo sold more than than 721,000 Wii consoles in March. It also had the No. 1-selling console game, “Super Smash Bros. Brawl,” which sold 2.7 million games since its launch on March 9. It also had two other titles in the top 10. That helps it answer rivals who said Nintendo was selling a lot of consoles but wasn’t selling a lot of games to go with them.

The Wii sales were more than the combined sales of the Sony PlayStation 3 (257,000) and the Microsoft Xbox 360 (262,000). Microsoft was quite pleased that it took back second place from Sony after trailing behind the PS 3 for two months. The Nintendo DS handheld sold 698,000 units while the PlayStation Portable sold 297,000. The PS 2 trailed with 216,000 units sold.

“You’d never know that the U.S. economy was under distress by looking at the video games industry sales figures.,” said Anita Frazier, an NPD analyst. “Year-to-date growth is a rock-solid 27% through March 2008. Across hardware, software, and accessories, the Wii contributed the most to total industry sales, representing 31% of total industry dollars for the month.”

Every month, Microsoft comes up with clever statistics that show it really isn’t losing to Nintendo. This month, it says that $9.4 billion has been invested in the Xbox 360 console to date. That includes all hardware, software, and accessory sales and it is bigger than what Nintendo has generated (Nintendo launched a year after Microsoft).

Microsoft says it has overcome shortage problems and has stores stocked in time for the April 29 launch of Take-Two Interactive’s highly anticipated “Grand Theft Auto IV.” It also says it delivers 4,800 hours of programming of video content on the console. And it has the highest game sales per console, or attach rate, in the industry at 7.5 to 1.

Sales were also up month-to-month from a total of $1.3 billion combined sales in February. Sony said that it was pleased with its own progress. PS 3 sales were up 98 percent compared to a year ago and PS 3 software sales were up 139 percent. Sony also notes its season of big releases has come. Just as Nintendo had the Smash Bros. title, now Sony anticipates a pickup with GTA IV and Gran Turismo 5: Prologue. Sony also noted its PlayStation Network online game membership is now at 3.7 million, compared to 10 million for Microsoft’s Xbox Live.

I guess this means that people aren’t putting gas in their cars. They’re not going to the market. They’re not going to the movies. They’re not flying on airplanes. They aren’t buying new houses. They’re just sitting at home playing video games.