Wedbush Morgan's Michael Pachter has recently made his forecasts for early 2008. The analyst predicted that the industry is set for strong growth for this year's first quarter, thanks to Activision and Vivendi's recently announced merger, and strong Q3 sales.

Pachter notes that reported industry sales are up 27 percent and "well ahead of our (Wedbush Morgan) 19 percent estimate." Pachter further elaborated on his forecast, ahead of NPD's sales figures for last month:

In order for our forecast to be right, December software sales would have to be down year-over-year (this is highly unlikely), so there should be significant upside to our growth estimates. Should December sales be up a modest 10 percent, overall industry growth will approach 23 percent for the full year.