Activision Inc  is adding drums, bass guitar, and microphone to its popular “Guitar Hero” video game, a move aimed at winning away fans of MTV’s rival musical title “Rock Band.” “Guitar Hero World Tour” will include the ability for two groups of four people each to compete online, as well as let players compose and play their own music, Activision said on Thursday.

The game will feature songs from bands such as Van Halen, The Eagles, Linkin Park and Sublime, with every song being an original master track, unlike past games where many of the songs were cover versions.

Due out in the fall, the game will mark a new direction for the “Guitar Hero” franchise, in which players push colored buttons on a plastic guitar-shaped controller to match notes on the screen.

“I certainly think it takes the edge off ‘Rock Band’,” said Mike Hickey, an analyst with Janco Partners. “What’s ‘Rock Band’ going to do now, add a flute and banjo?”

Activision’s money-spinning franchise got its first real competition last November when Viacom’s MTV unit launched “Rock Band,” which featured drumming and singing in addition to guitar playing.

The “Guitar Hero” series has raked in more than a billion dollars for Activision and has helped drive a 72 percent rise in the company’s stock over the past 12 months.

That compares to virtually flat performance in the shares of Activision’s top rival Electronic Arts Inc (ERTS.O: Quote, Profile, Research), which distributes “Rock Band” for MTV.

Shares in Activision were up 19 cents, or 0.6 percent, to $32.82 in late morning trading on Nasdaq.

Nintendo continues to have a hit with the Wii gaming console.

Consumers bought 519,000 Wii systems in October, according to monthly figures released by The NPD Group, helping Nintendo to regain the top-selling spot among next generation consoles. That brings total U.S. sales of the Wii to 5 million.

“Demand actually continues to increase,” says Nintendo’s Perrin Kaplan. “People just can’t seem to get enough of it.”

Microsoft’s Xbox 360, which usurped the top sales spot in September fueled by the release of Halo 3, sold 366,000 — a drop from the previous month’s tally of 527,800, but still higher than the spring and summer months.

In mid-October, Microsoft released an Xbox 360 Arcade model ($280) aimed at casual gamers and families which helped buoy sales, says Microsoft’s Aaron Greenberg.

Halo 3 remained the top-selling video game in October with 433,800 copies sold, bringing the total to 3.7

Guitar Hero III: Legends of Rock (with enclosed guitar, $90-$100) took the next three spots, with the Xbox 360 version selling the most (383,200), followed by the Wii version (286,300) and Sony PlayStation 2 version (271,100). “For us to see that title selling the best on our platform speaks to the fact that we are really broadening our market to that mainstream consumer,” Greenberg says.

A game-only PS2 version of GH III ($50) finished at No. 8, selling 231,700. In total, GH III sold 1.4 million copies (including a version for the PS3, as well as other versions that come with soundtrack CDs).

“Guitar Hero has certainly established itself among the elite video games properties,” said NPD’s Anita Frazier. “Very few games sell in excess of 1 million units in their first month in market, but Guitar Hero III did easily with combined sales of 1.4 million units in only six days. Since it has broad appeal, it’s also the type of game that should continue to do very well throughout the holidays.”

Sales of various guitar controllers also increased monthly accessory sales, she said.

Sony’s PlayStation 3 sales increased slightly in October to 121,000, increasing the system’s installed based to nearly 2 million. On Wednesday, Sony chairman and chief executive Howard Stringer said that an Oct. 29 price reduction of $100 of the 80 gigabyte PS3 (to $499) and a new $399 40GB model had boosted sales.

However, the PS3 price cut’s effect won’t be seen in the monthly sales figures until next month, Frazier says, “so we’ll have to wait until our data comes out next month to see the effect of that cut on retail sell-through of the hardware.”