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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.""
My Dream of always wanting to own an arcade is still existant, even if I barely make money. I remember spending hours a day because my parents both worked after school was done. I ruled at SF2, which I believe has caused me to be the genius that I am today, along with decent hand-eye coordination.
The fact is, players need to practice titles like Virtua Fighter to be any good at them, because games today are more complex than ever. Some titles -- specifically fighting games -- can even be overbearing for players, as these games demand a significant amount of time and money for a player to learn the gameplay intricacies.
Exactly, you can sit down at Arkanoid, Centipede, Ms. Pacman, etc (the "old-school" arcade games) and immediately grasp 90% of the necessary game play. With newer games such as just about every fighting game after Mortal Kombat and racing games you need to A) sink $1.00+ into the machine to even play, B) read instructions on how to just do the most basic of moves, and C) you get about 3 minutes of playing time almost regardless of your previous skills with similar games.
Golden Tee (which they don't seem to mention by name) has been taking off because it is absolutely addictive and it is ALL over the place. My group of friends used to play GT two or three times a day, every day. We were ok, nothing super spectacular (-20 or so), but we had fun doing it. Try sinking $12.00 into a racecar game and playing with four friends and that $12.00 is gone in less than 5 minutes, at least 18 holes of Golden Tee takes almost an hour...
The home market I suppose has something to do with it. It happens to be driving the industry into making these super flashy games that they think will compete... They don't because of the never-ending costs. A $50 console game will allow you to play forever. $50.00 will give you 10 to 20 games of some random Racecar X 2054! arcade game.
I'll stick to the old-school games and Golden Tee, at least I get my money's worth and actually enjoy the time spent playing.
Cut down the prices to 25 cents again or make the games have better game play. That's what I think will work.
Recently, hole in the wall arcades have started to be replaced by bigger entertainment centers like GameWorks and Dave & Busters.
While these two places serve their purpose they aren't exactly what I would consider something I would prefer over "hole-in-the-wall" arcades. They are basically overpriced bars with a lot of arcade games for adults. Sure they have a lot of titles and they have the old-school games (up and out of the way usually) but they are more into serving food/drinks than they are about charging reasonable prices for the games. I am sure they make plenty money w/o having to overcharge for the games, yet they do. So instead of going out and blowing $5.00 on games you blow well over $50 + food/drinks. Bring back the old-school arcades!
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?
Slashdot Syndrome: the sudden, extreme urge to correct someone in order to validate one's self.
Celebrity endorsements! Thats just the ticket to get the arcade industry back! Anyone up for a game of "Danza Danza Revolution"?
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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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.
...why, after a long day's work, would I then want to go somewhere else to pay money (two quarters at a time) to play video games? Granted, the arcade may be more social, but if I can pay Counter-Strike online from the comfort of my own home, for an initial fee (the purchase price of the game), it's just a better deal than pumping in quarters in for limited replay value.
libertarianswag.com
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.
I'm still happy with mining all the old 8bit games, though, so I can't get too worked up about the current state of games (most bore me just looking at the box, "Oh, another FPS") and haven't bought a game box in years. Longing for the golden years of games I've been working on some game builder ideas and maybe they'll amount to something in the coming months.
There'll always be a tender spot in my heart for the hundreds of bucks I spent at Alladin's Castle, back in the day, and some of those really cool games, but most of them are available on collection CD's for $10 now. All that's missing is the atmosphere and that's unlikely to be coming back in any form, let alone a living room.
A feeling of having made the same mistake before: Deja Foobar
My dad owned a small vending company, just him and my uncle, they even picked a know Italian name in the area so as not to be bothered by mob types (it worked)
:) Tempes would clear $400/ weeke gross and the pinballs were about $200 / week. Asteroids twoards the end was only clearing $100 a week or so, so it was the first to end up in the garage, by the time I was a SR in High school 88 all of the machines were in the garage, it was great for parites 10 pins 10 vids a couple of jukes, lots of fun, I still conten I am the BEST tempest player that ever lived PERIOD, I would play for hours every day, If anyone knows what the LAST level looks like, befroe it recycles, I will acquiesce that you may be as good of a tempest player I was.
They started in the days of PONG and quit in the age of Tempest , They bought a COUNTERFIT pac-man when pacman was hot, not because it was cheaper (it wasnt) but because you simply couldnt GET a pacman without waiting on backorder, its patters were different , the kids loved it for that and would gamble on its outcome regularly, the gross for the machine was nearly 700 $ / week, 1/2 of that went to the "house" a roller rink. It was insane we would go every saturday moring to all the location, and collect, You know how much 2000 $ in quatrers weighs
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.
...things like Mo-Cap Boxing, Martial Beat, and Police 911...and big-screen fighters.
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
"Mod, mod, mod...and another troll bites the dust."
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
free ipod and free gmail!
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.
--Gentoo Baby!
The old classic games are still a great investment for small establishments. In Seattle, at least, old pinball, Pac-Man, Tetris, etc., games are popping up all over in coffeeshops and bars. And they're doing great. In places where they sit alongside the latest 3D subwoofer-enhanced consoles, I see them occupied a lot more often. Is it because they're not $1.00 to play? Or is it because there's something intrinsically more entertaining about playing the older games in public spaces. One has to wonder, is the home console market (where complex 3d graphics reign supreme) fundamentally different from the arcade market? Or is what I'm noticing just nostalgia?
Chuck E. Cheese's is apparently still making money. Sure, they charge you $35 for a bad pizza and drinks, but then they give you 100 free tokens! Well... my 3-year old likes it, anyway!
"Freedom means freedom for everybody" -- Dick Cheney
In the eighties, games were the existence proof that computer programs could be accessible, quickly learned, and usable without reading a manual. What a pity that they, too, have succumbed to bloat, complexity, and featuritis.
"How to Do Nothing," kids activities, back in print!
Ms Pacman understood me. She accepted me as I am. And most of all, she did what I told her to do without question.
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.
My question -- slightly off topic -- but I'm really curious: who here actually *remembers* the old school arcade games? Pac-Man? Donkey Kong? Frogger? Tron? Pole Position? I mean, arcades back in the 80's were something pretty spectacular. I had the misfortune a few weeks ago of hitting a local place called 'Dave and Busters' (no idea if it was a chain or not) but I was *astounded* at how arcades have changed. I still have fond memories of Aladdins Castle in our piddly mall. Getting five dollars worth of tokens (around 25, I think), and spending the whole afternoon in front of Tron or Pac Man or even -- my little guilty pleasure -- "Journey": the arcade game named after the band. You controlled Steve Perry and his band mates. I don't remember it too well, but I remember we played it a lot -- and listened to 'Separate Ways' and 'Faithfully' a lot, too. Memories.
There is an arcade near me that seems to have a relatively successful business plan: Get a bunch of old video games, skeeball machines, pinball machines, etc., charge only a dime to play, but collect an entrance fee. I'm more than happy to pay the 2 dollars for continuous access to lots of great games.
Wave of the future maybe?
Organized crime has found other ways to launder its money.
I don't know the meaning of the word 'don't' - J
The reason that they are no longer making money hand over fist must be because of _piracy_ (ie MAME)
With arcade games, the home systems initially (Atari 7800, Ninendto, up to the PS1) were simply not as good as the arcade versions. The PS2 however, produces games that are pretty much on par (and sometimes better if you read the article) than it's arcade counterparts.
Arcade games need to provide people with something they simply can't get at home - and in my opinion it has to do with the user interface. Arcades should attempt to shift the focus to virtual reality type games - ones where you're sitting in an actual vehicle or cockpit - something where the hardware to produce the experience simply could not be replicated in the home environment. I played some wacky Mech game at the local Jillians, where we all were sitting in these darkened close-door pods and seeing nothing but first person view. The game was $10 for 7 minutes of action and then we all got to watch a video reply of all the action in 3rd person view. It struck me as a step in the right direction ...
Oh and BTW if porn theatres want to get customers back, they'd also better provide a VR experience that we can't get at home ;-)
I route arcade machines (place them out in locations to be played) and repair and convert them.
There are two major costs of these machines. Monitors and PCBs. A standard arcade game uses a 19" monitor (cabaret, the smaller uprights, tend to use 13" monitors). These 19" monitors brand new range from $200 to $500, and used ones need to be in good condition to be useful, so they're not much cheaper.
The PCBs, mostly the entire game, except for some of the interchangeable systems such as the NeoGeo MVS and the Naomi Systems, are quite expensive. Although these are mostly based on how new they are and how popular they are, if you're lucky you'll find a PCB for a game that may bring in quarters for about $50 on eBay. For a game like Tekken Tag Tournament, you'll be spending $250-$350.
Then there's the cabinets. You need solid enough wood to hold the monitor in the upper part of the machine and make sure people can't easily access its guts. At least $75-$100 to build your own from scratch, and at least that much to buy a decent cabinet to convert to a proper machine.
The controls are relatively cheap. Buttons are about $1-$2 each, $3-$10 for the joysticks, $25-$40 for the trackballs, etc. Since these are universal, buying in bulk if you do what I do is a way to save money without anticipating which games you'll have in the future.
Okay, that's out of the way. For me, I'll spend between $300 and $1500 to purchase parts or fix-me-ups and rebuild them into fully working and restored games. To make it worth my while, I have to assume that I'll make that money back in under nine months, or I feel it'll be a costly venture. This is just my estimate, since I'm the only one who works on these machines, I have a much lower overhead.
When you route a machine, instead of having them in your own location, the standard of the industry is split. That is, for every two quarters you get in a machine, one goes to the location and one goes to you. They pay for the electricity and just make sure that the machines aren't abused, and I keep them working and buy more machines. In the end, I have a higher cost, but I also choose where machines go more than the locations and can always sell them if I need the space or money.
Yes, arcades will be unprofitable these days for one specific reason, and that is what I described above. To drag people into an arcade, you need to make sure they want to go there. When I route machines, people are going to the location mostly for the location first, and if they have spare change, or a need to play, they'll plunk quarters into the coin slots. For an arcade, they're going to the arcade mostly to play the games, so you need to make sure you have some games for those players.
The investment to insure you have enough of the big machines or new machines, like DDR or SNK vs. Capcom, is extremely high. A DDR will set you back $15,000 easily for a two player machine with a new mix inside. Plus the space for this will drag your rent upwards. When I route, I just need to make sure there's enough clearance at the location, where they pay the rent.
Then, if you have too many people coming just to play games at an arcade, you need to make sure you have enough copies of the popular games. If you have one DDR, one SNK, one Ms. Pac-Man, one Galaga and, let's say, one air hockey table, along with several other less-played machines, people will be waiting around to play the popular games, and may just leave and not come back. Therefore, many copies of these are very necessary, higher costs. For me, having one DDR, one SNK, one Ms. Pac-Man and one Galaga in a location will be perfectly fine, as there won't be as many people playing at once, and people will return to the location for the location anyways.
In conclusion, arcades are a dying breed. They need to find a new angle to survive, such as what sportscard retailers did when sportscards were bombing (they got into Magic: the Gathering and other games), or what comic shops did when the comics indust
Human nature is the same everywhere; the modes only are different. -- Earl of Chesterfield
I'm not really sure what D&B's business plan is these days.
There was a time, circa 3-5 years ago, that my friends and I would go to our local Dave and Busters about once a week to have lunch or dinner and play a bunch of games. Every time we went there there'd be at least one new arcade game to play, and the food was always excellent.
At the time, their business made a lot of sense to me. You have this whole generation of kids who grew up going to the arcades that's now grown up. You get them back in and make money off them as adults with a combination of the fun and nostalgia of their arcade days and great food/drinks. By making it this upscale, adult-oriented establishment you turn what was seen as a niche quasi-geek activity into something more acceptable and mainstream.
Their restaurant/bar quality has gone way downhill in my opinion over the last few years, while the prices have gone up. Now new arcade games at the D&B are rare in the extreme (is this because they're buying less or because, as the article suggests, less are being made?). It used to be that as an adult professional I could make a case to even non-arcadeophiles to do a lunch at the D&B because the food was so good -- now that's just not the case anymore. I'm just not sure what the draw is supposed to be, now.
The Gameworks I've visited still has fairly good food, though I can't say I like their layout/setup as much as the D&B's.
Is it possible that one of the problems with the arcade industry is mismanagement of the arcades themselves?
First you claim pinball takes far more skill than any fighting game, then you claim that your friend became an expert in what... 20 or 30 games?
It takes hundreds of games for most of my friends to become "expert" at a single character in Soul Calibur 2, and we play quite a lot of that game.
Then again, we are competing against each other, not a machine, which means being an "expert" also includes knowing your opponent and predicting their next move.
If you have to ask, you just don't get it.
Seriously. I was born in '69, so I was there when all of the classic games came out. Maybe I am just being nostalgic, but it was an awesome time. Take your $5 that you saved and go to the arcade. You could play 20 games, if you didn't buy any chips or Coke. You could watch other people play. I remember when Pac Man came out. I bought the damn "Pac Man Fever" 45. I remember playing Moon Patrol and Joust at the Pizza Hut. I always went for the 5x in Lunar Lander instead of playing it safe with the 2x. Sinistar still scares the crap out of me. I spent many many hours playing Star Wars. Games like Gauntlet let you play alongside other people. I could go on and on. Check out Video Arcade Preservation Society (VAPS) or the Killer List of Video games (KLOV) if you want to go back in time a little. And there is always MAME for a more hands-on approach.
It isn't like home systems weren't fun, I broke countless Atari 2600 joysticks. But you just can't compare the classic arcade scene to home gaming or arcades of today. It just doesn't work.
My beliefs do not require that you agree with them.
Back in the late 70's when I went to grad school I used to fix PAC-MAN, Donkey Kong, Tempest (a real bear to work on that French X-Y monitor) and other systems for pocket money.
The games were easy to learn quickly so people could get addicted yet the upper stages would be challenging so they would keep coming back and not get bored. Also, there was a wide varience of themes so if someone didn't like shooting or bombing something they could just roll a marble around an obstacle course or something.
Nowdays if you don't want to beat the s**t out of someones on-screen avatar or shoot someone with a realistic gun you're pretty much out of luck. I used to go to the arcades (I was addicted to the AREA 51 series, no I have nothing against shooters), but my kids didn't like any of it until a local Putt-Putt operation got Dance-Dance-Revolution (and now DDRII). I quit going because the arcades in the malls turned into gang hangouts. The punks spent the day practicing shooting and beating each other up on-screen. Another favorite activity was getting arrested by the cops in the arcade since the cops knew where to pick up the punks that beat up or shot someone the night before. Since my kids didn't like those jerks they had no desire to go there, no matter what was there.
Back in the '70s I would fill in on shifts while I worked on machines (extra bucks). We had strict policies that the punks weren't welcome and that was what security was there to insure. Families were welcome, doctors, medical students, and college students were the advertised audience, and they dropped the quarters as long as the machines were running (which was where I came in).
If they want me and my kids to show up and drop our money (and we have it to blow, thanks to many years of hard work) it needs to be a place I don't feel a need to bring a REAL gun.
Incidently, we added poll tables, arcade games, foosball tables, and some tables and chairs to a side room at our church cafe' - it stays full. The problem with arcades is the same as the problems with bars, it isn't what's in there, it's who they let in.
It doesn't matter what you wrap your emotions around, Reality is a brick wall specifically designed to scramble eggs
Problem is, it takes even more skill to find a decently set-up and clean Addams Family pinball machine these days than it does to play it. In other words, finding a good pinball joing is damn near impossible.
> Anybody know of a pinball museum with accessible games to play?
Google for a pinball collector named Tim Arnold. He has semiregular "fun nights" in Las Vegas that'll give you a chance to play some of the machines in his astounding collection.
Tim has also set up a nonprofit to found and fund an open-to-the-public pinball museum that would be a welcome addition to Vegas.
If you're in the Bay Area, be sure to attend the annual CA Extreme classic coin-op convention in San Jose, and Pin-A-Go-Go (link to one of many 2002 show reviews) in Dixon, near Sacramento.
It's called a self-correcting negative feedback loop.
the preceding comment is my own and in no way reflects the opinion of the Joint Chiefs of Staff
...where you can get beaten by smug pre-pubescent punks in the comfort of your own home!
I was a fan of DDR before the US arcade release a few years back and after seeing how much money it was pulling in at the metroplex Putt-Putt I decided to try getting into the arcade business.
I went through all the steps, getting a business license, registering with the state and county and found my first machine....an import DDR 3rd Mix Korean machine. It cost me about $1500 for the game and shipping from Korea to get it here. On the same note, a new US version machine was about $7,500. I cleaned it up and worked out a deal with a local store owner and put the machine inside. At times the machine was pulling in over $500 a week. I was splitting the profit with the store owner (a suggestion given by other arcade operators) so it was making me $250 a week at times. On average I would say it made me about $125 a week. This was in a town of 30,000 people about an hour from any major city. People would drive down from the bigger cities just to play it.
I eventually added a Beatmania IIDX 2nd Style machine to the lineup (later upgrading it to 4th Style) and a sit down Neo-Geo 4-slot. They made a nice chunk of change as well but nothing compared to the DDR machine. I ended up selling them off after a few years for more than I paid for any of them. It was a sweet little setup and fun while it lasted.
I wish I could have started my own import arcade at the time but couldn't come up with enough funding to do so. That's my only regret. I had big plans but couldn't get any financial backing. Splitting the profit 50/50 sucked but at least it gave me a place to put the games.
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