Could this signal the beginning of the long predicted video game crash?

For the third month in a row, total videogame software sales declined by at least 19%

Before you can say "Platform change", look at this:

"We believe the weakness was due, in part, to gamers delaying purchases ahead of the Xbox 360 launch on Nov. 22. However, recent comments by retailers and publishers indicate that softness extended well into December.

The quoted analyst (SG Cowen analyst Lowell Singer) lowers estimates on all the major players in the industry, but ends with an optimistic note

"We maintain a long-term positive view on the videogame sector, although the console transition is likely to drive volatility in stock performance over the next six months. Activision is our preferred name in the group due to strong and improving game quality, expected margin expansion, and attractive valuation," the analyst said.

Dude... When Activision is your "preferred name", you have an industry in trouble.

The report also fails to mention the censorship angle. I am sure investors are spooked by the specter of Federal Censorship on the horizon.

I know I am.