Enterbrain, the publisher behind Japanese games bible Famitsu and the leading authority on the Japanese games market, has released its 2008 report – and it shows that despite the gains seen in the UK, the Japanese market shrank by 15.3 per cent in 2008.

The 2008 market value hit YEN 582.61bn, down on the YEN 687.95bn seen in 2007. Hardware was the steepest decliner, dropping 23.5 per cent to YEN 250.5bn, whilst the software market dipped 7.9 per cent to YEN 332.12bn.

Bucking the trend, however, was Sony’s PSP, which enjoyed year-on-year hardware sales growth of 17.2 per cent thanks to its 3.54m unit sales. Its lifetime sales to date in the territory now stand at 11m. Capcom’s Monster Hunter Portable 2nd G was the spearhead of this growth, selling just shy of 2.5m units.

It was also a strong year for DS, with Nintendo’s handheld selling 4m units, bringing its Japanese install base to 25m. The DSi, Nintendo’s second redesign of its machine, sold 1.28m units despite launching late in the year.

Whilst Nintendo’s Wii sold 2.9m units throughout 2008, Sony’s PS3 failed to shift one million units, falling just short at 991,000. The PS2 sold 480k whilst Microsoft’s Xbox 360 sold 318,000 machines.

Click here to read Enterbrain's detailed 2008 Japanese market analysis in full.