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State of the U.S. Arcade Industry 2004

Gamaroo writes "1up.com has posted an article on arcade game machines, the loss of the profit margin and the future of the industry. In their words: "There was a time when an arcade operator in America could buy a Ms. Pac-Man machine for less than $1,000, let it sit in an arcade, bar or storefront, and see that game make back over 30 times the initial investment. In 2004, that kind of profit margin is little more than a pipe dream.""

19 of 417 comments (clear)

  1. Rightly So by Doesn't_Comment_Code · · Score: 5, Insightful

    The door has swung the other direction. As a child, I wasn't the richest kid in town, and I didn't play arcade games much. It was a quarter a pop, and if you aren't much good (which you can't be without experience) your quarter doesn't last long.

    I remember quite vividly getting my first nintendo, and how amazing it seemed that I could play Duck Hunt for half an hour with no line, and no quarters.

    Why go back?

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    1. Re:Rightly So by Mattcelt · · Score: 4, Insightful

      I don't know, I sort of miss the old arcades. It seems that unless you go to the beach (where all they have is crappy old games, sometimes not even pacman) or to some malls, there's no place to play more than one or two games. (I.e., there are only one or two cabinets to choose from.)

      What's worse is that the price for cabinets has gone through the roof. In 1989 you could buy a used Ms. Pac Man for less than $400. Lately I haven't seen one for less than $1500. The revival in their popularity has driven the price up substantially. It irks me too that the combination Ms. Pac Man/Galaga machines now charge .50 per play - why is it double the price to play an old game??

      I liked the old arcades (as opposed to home consoles) because 1) they didn't cost $50 for a game you might not like; 2) when you finished one, you weren't stuck with a used game you won't play again; 3) the arcades tended to rotate their stock every couple of weeks, so there was always a new game to play; and 4) there was almost always someone new to play against. You just don't get the same diversity with consoles.

    2. Re:Rightly So by Phillip+Birmingham · · Score: 4, Insightful

      What's worse is that the price for cabinets has gone through the roof. In 1989 you could buy a used Ms. Pac Man for less than $400. Lately I haven't seen one for less than $1500. The revival in their popularity has driven the price up substantially.

      It irks me too that the combination Ms. Pac Man/Galaga machines now charge .50 per play - why is it double the price to play an old game??

      Hmm, I wonder. Could the two be somehow connected?

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  2. Games are expensive now... by 192939495969798999 · · Score: 5, Insightful

    First of all, games cost more now because the systems are more complicated. If you could make 30 times the current investment back on some of the more expensive games now, it would amount to over $100k. Second, Pac-Man is arguably one of the greatest games ever created in terms of popularity. Hence the reason the "game" icon on /. is what else, but Pac-Man himself. How much has Tetris made? A ton. Is there still room for profit? Yes. Does every game generate the type of profit that Pac-Man or Tetris did/does? NO!

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  3. Profit loss... by DecimalThree · · Score: 5, Insightful

    I remember back in the day when I'd drop a few buckets of quaters at the arcade. I could probably retire if I had all those quarters back! Now with the increase in technology and such "large" games being condensed to compact disks one would almost think that arcades "should" be obsolete. The future of the industry has changed because the technology has changed. Much in the same way the courier business had to change it's entire model in the 80's due to the big boom of fax machines. While the arcade business may independantly suffer a loss it is the end consumer reaping the benefits. That is one of the things that makes technology so wonderful.

    1. Re:Profit loss... by garcia · · Score: 4, Insightful

      Do you really enjoy sitting at home learning a game by yourself? I don't. The simple reason for this is that by watching someone else play (in an arcade or at least in person) I learn something new that I probably would not have figured out in any short order.

      Golden Tee is a perfect example. You learn all the trick shots, shortcuts, methods, etc, by watching some random guy just kick the shit out of the machine. He might not know what you know and he learns from you back.

      It's unlikely that you and your small group of friends will know everything there is to know like the rest of the world does.

      It gets you out of the house. You might be surrounded by other geeks but at least they are likely to be different people than you are used to.

      Why must video game playing be so solitary?

  4. Re:Bring back old-school arcades/games. by Tran · · Score: 3, Insightful

    Dave and Busters also seems to have as many if not more gambling type games as video games. Which I also think is an indicator on the lack of viability of the arcade video games as things stand now.

  5. Re:Bring back old-school arcades/games. by Decaffeinated+Jedi · · Score: 5, Insightful
    With regards to fighting games, don't forget that other factor that drives would-be gamers away from the arcades: the Fighting Game Master.

    You probably remember him as the guy who seemed to live in the arcade and was always playing the cool new game that you really wanted to try out. Eventually, you'd get up the nerve to challenge him, but he somehow selected a secret character that wasn't available from the main screen, and proceeded to unleash every special attack under the sun to dispose of you in about three seconds. Then, he looked over, sneered, and let forth a sarcastic "good game."

    I know the Fighting Game Master personally drove me out of the arcade and to the home consoles.

    --
    DecafJedi
    my weblog: apropos of something
  6. Hardware competition by Cutriss · · Score: 5, Insightful

    One of the reasons cited for arcade losses lately is that home consoles have comparable power to the arcade machines, meaning that there's little reason to go to the arcade when you can just play the same game at the comfort of home. It's one of the same market transitions that the MPAA fears like crazy.

    I feel that's why Bemani games like Dance Dance Revolution and Drummania are so popular - They offer a unique experience that isn't easily recreated at home without a substantial hardware investment. Sure, you can buy softpads or metal pads for DDR, but the arcade is still where it's at for both ideal configurations and the social factor.

    Everyone always says that console peripherals never sell well...So, perhaps the games needing the peripherals should be tried more in the arcade. What games are really popular in arcades? Silent Scope...Bemani titles ...things like Mo-Cap Boxing, Martial Beat, and Police 911...and big-screen fighters.

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  7. MAME cabinets by Chuck+Bucket · · Score: 5, Insightful

    If they were able to run MAME cabinets with all of our fav games from the 80's, then they'd make some coins.

    CB

  8. Who Cares? by dasMeanYogurt · · Score: 5, Insightful

    I can see why. I have no reason to go to the traditional arcade anymore. Between my PS2 and PC I have no urging to waste quarters at the arcade. To return to the arcade I need something different. Way back when the arcade offered better graphics and range of games. I want to see something I can't do at home, be it VR helmets/pods, floating holograms, or some other new fangled contraption.

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    --Gentoo Baby!
  9. Sad state of supposed 'arcades' today. by tigerknight · · Score: 5, Insightful

    Likely because the games were actually FUN back then. Sure they were simple little platformers, but you could go for as long as you had the skill to survive. Not to mention the fact that everything now is almost a dollar or more to play for 2 minutes, thanks to timers and 'checkpoint' play there's just no way to feel satisfied out of the money you put in.

    I'd gladly throw $20 or more at an old quarter arcade from the early 90's (and would gladly do so again if they had some today), but today's 'arcades' simply aren't. You have a few hulking machines taking up all the space because shooters need distance from the screen, driving games need chairs and such, and heaven knows what else (silent scope et al that need rediculously large gear).

    Where $20 used to go 60-80 games (some games were $.50 *GASP!*), it'll now go maybe 15-20, and anything that's still the same old cabinet type is just a fighting game with no creativity or amusement to it at all. No thanks.

  10. Re:Bring back old-school arcades/games. by Joseph+Vigneau · · Score: 5, Insightful

    I completely agree. Nowadays, the only way arcade machines get my quarters are if they are "old-school" (childhood nostalgia value, from the golden age of arcades: Pac Man, Tempest, Galaga, Robotron 2084, etc.), or Golden Tee. Home console gaming lets me play my games on my terms when I want to. Arcades these days are full of genres I generally don't care for: driving (cars, boats, snowmobiles) or fighting games, which are three minute multi-button mash-fests.

    As the article alludes to, the only way the arcade industry has any hope in the US is to add the online element, and especially a way to have the player feel like they are actually competitive within the game. There's no point to have a player ranking system where there's just no possible way I'll ever be better than 2324th place. A tiered system would really help to get the player more involved. I know I'd play a lot more if it got me from 24th place to 9th place, than if it got me from 2320th place to 1387th.

    So, 25c machines with simple, yet addictive gameplay, and online action for more complex games are necessary for the arcade to survive beyond 2010.

  11. Re:There is only one reason for arcades now by bwalling · · Score: 4, Insightful

    There is only one reason for arcades now. Games that require special peripherals beyond keyboard/mouse/gamepad. They could be basic driving games, or they could be things such as Dancing Pads for DDR.

    I may drop a quarter now and then to play a good racing game in an arcade. I'm not going to drop a hundred bucks for a steering wheel/gear shift/pedal set for my PC/console.


    The problem is that those "special peripherals" cause the game to be $1.00 a pop. Many of the games are timed, so a poorly skilled player is paying $1.00/minute to play the game. I bought a DDR mat on eBay for $20 and the game for $20. My wife and I have probably played 500 games on it.

    I'm not paying $1.00 a pop to learn to play a game. They're too damn complicated to be paying to learn it. There wasn't much to learn in Pac-Man or Galaga, and you definitely didn't have to waste a bunch of quarters to find out that up-down-fire-fire-jump would do a super ninja roundhouse, where up-down-fire-jump or any other combination will just get you killed.

  12. Re:Bring back old-school arcades/games. by Anonymous Coward · · Score: 3, Insightful

    I remember sitting in an arcade while my parents went shopping, I'd have money say $10 and would love to play the games there. Games of Frogger, Rampage, etc.. cost 20c and I could play for the hole hour or so. There were lots of other kids around me, and we were all 'playing together'. Then the newer games game along, fancy 'teenage mutant ninja turtles' and the like, they cost $1 and the other games had been jacked up to 3x20c .. suddenly my time in the arcade was shortened. I would spend the time, looking at the machines.. too expensive for me and most other kids to spend our idle time on. Some kids left. I left. The atmosphere was gone. There where some kids of course but they had, 'new' money, and would spend it have a quick game and leave. The gaming industry tried to follow the consoles with these fancy new games, but the consoles still had their inherit advantages of being 'free' to use, and at home, (or the friends house). When the social culture of going to the arcade changed, came the end of the 'profit'. Arcades started doing, SUPER sessions, where you had free games for parties and such, these were great, the atmosphere was there again. But not for 3x20c. And not for the 'cash cards' the 'hope you won't notice you're money going away' cards.

    Bring back CHEAP idle time games for kids, and you'll have that stable revenue again. IF there's that social atmosphere, and not one of disapointment.

  13. Re:Bring back old-school arcades/games. by Bendebecker · · Score: 5, Insightful

    I agree with you: the old school arcades rocked. There was nothing like standing in a dark smoky room with the sounds of video war being raged all around you. The real reason those places began to collapse though is not just becuase the games got more complex (any RPG beyond Cadash would never work in an aracde) but also becuase the atmosphere of those hole-in-the-wall arcades changed. You have a bunch of teenagers running around a darkened room, their pockets filled with cash. You just knew crime would become a problem and it did. The arcades began to be populated by gangs and older kids who would steal the cash off the littler kids. Arcades became a place were children should be afraid to enter. That's what led to the rise of the family arcade places (which were no fun for teenagers.) That's what probably hurt the arcades most - they became dangerous. Then gradually as the NES and the consoles began to not only match but outdo any game you'd find in the arcades (during the atari era the console games were cheesy compared to the arcades), people could no longer justify putting $50 in machines when they could just buy the carts. So one by one the places shutdown. The only thing keeping the arcade business running now, I bet, is the children who can't afford a console, the supermarket arcade machines (play video games while I shop), and the arcades that try to recapture the feel of what the arcades were in our youths (i.e. nostalgia).

    --
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  14. ...related social issue.. by SubtleNuance · · Score: 3, Insightful

    One related issue I believe is urban design. People are no longer required to leave their homes for an arcade experience. GOING To the Arcade for the 'marginally better' experience CERTAINLY isnt worth driving your car across the city (a long trip) just on a 'whim'. North Americans spend alot of time in their cars navigating our sprawling communities -- this encourages 'cocooning', people building their own private domains for all things. People just cannot be bothered to leave their homes and navigate the stinking, expensive, unsafe, endless roadways to get to the aracde.

    If our urban spaces were designed more wisely, an arcade would be 'closer' and more accessible. The benefit of social interaction (with strangers, neighbours and friends) would be more easily realized... not to mention access to all the best games.

    With Sprawl just getting to the arcade is a chore.

  15. Play quality vs Graphics Quality by 4/3PI*R^3 · · Score: 4, Insightful
    The biggest problem with the new console arcade games is that they are relying too heavily on graphics quality. The great things about the old console games was that since the graphics generally sucked (compared to today's standards) the games had to have real playability.

    In most modern games the rules are basically as follows:

    Figher : Kill everything in sight

    Shooter : Kill evrything in sight

    Racer : Get in front of everything and go really fast

    Remember how popular Pac-Man was? All you had to do was eat dots. But you had to figure out a pattern to avoid the ghosts and you were rewared with humorous little movie clips. Remember how popular Donkey Kong was? All you had to do was rescue the chick. But you had to figure out how to avoid the barrels, fireballs, pies, bouncing rivets, etc. Even for home games, one of the most popular was the Atari 2600 game Fantasy Adventure. This games had the worst graphics ever but it had great playability.

    This quality of playability is why MAME is so stinking popular. We can still play these old games. How many /.'ers still drop a quarter into a Galaga, Pac-Man, Time Pilot, or Space Invaders machine whenever they see one?

    If console makers want to rebuild their market they need to make the games easier to control but make it more mentally challenging to play. I still play the Mario Brothers games on my old Nintendo Entertainment System. Who needs an XBOX?

  16. Re:This is exactly why we need by kaellinn18 · · Score: 4, Insightful

    Insightful?? WTF?? Who are you people?!?

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