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Massive Multiplayer Gaming Warehouses On The Way
hephaist0s writes "A company called Holo-Dek Gaming has opened a gaming center in New Hampshire where $5/hour buys gamers a 73-inch high definition projection screen and a networked Alienware PC or or Xbox. More impressive, though, are the prototypes for their 180-degree gaming theater... and their game sphere. Yes, sphere. This is just a pilot program--the Baltimore facility planned for 2005 would have 300 networked gaming stations. Story and pictures here, company website here."
Didn't arcades die because you could finally play the same games with the same quality at home?
Arcades are dead and PC Baangs (it's the korean name for those cybercafes where you can play games onLAN/online) are nowhere near as popular as arcades were back in the day.
Now I can see how these warehouses with their alienware pcs and nice screens (most of them are "only" 73 inches) would appeal to the same crowd that plays FPS and Strategy games and goes to LAN parties but that crowd is very very small compared to the overall gamer's market. Heck, the whole PC game market represents less than 20% so you can imagine the actual percentage of people who are fond of those games.
The idea just doesn't seem to have enough appeal to snowball into the next big trend. I know it doesn't appeal to me. For the cost of a handful of gaming sessions, I can buy a new $200 graphic card and play the same games on a respectable 20" monitor (ok, so I already own that) for as long as I want, in the comfort of my home.
This is not to say his isn't a valid business plan. The center can be profitable if the location is good and the marketing is done right. But that's only in the short term. Once the newness evaporates and those alienware rigs aren't so hot anymore (replacing 300 alienware rigs will cost you a cool $100,000) , I predict a steady decline into oblivion.
Um you assume it runs 8 hours a day? You obviously haven't been to a lan place people constantly cut class and sleep to attend. Also there is lots of money to be made through selling drinks games and hardware.
I think you'll find that it is easily possible, also they have some of the most lucrative deals in the marketplace, $1200 U.S. buys a hell of a system (even retail) Alienware's increadible markup's won't really apply to a company that isn't stupid enough to pay them, an arrangement will be reached. Also top of the line hardware can run for about 4-5 years before needing updates, basically the stuff just needs to run CS:S and Blizzard games.
You've obviously not thought very hard about these problems. These folks are in about the same boat as conventional arcades. Here we go:
Arcade games are expensive. According to Froogle, they seem to cost between $5,000 and $20,000, each.
Let's pick a nice middle-of-the-road number, and figure $8,000 each for a machine which takes up a lot of floor space, is a maintenance nightmare, and only plays one modern game.
Meanwhile, your retail prices for an Alienware box and the unlikely Sony projector cost a total of $6,800. Add $300 for six (or so) retail-priced software packages, for $7,100 total hardware cost.
This $7,100 gaming machine can play six different titles, has an enormous screen, can play any existing software title for an extra ~$50, and is easily maintained by minimum-wage flunkies. It is conveniently also $900 cheaper than an arcade machine that does none of these things.
The recurring business expenses are probably very similar. Insurance is similar. Wages, per machine, will be similar. They'll be using cheap warehouse space, while arcades typically consume expensive mall realestate - almost certainly saving money, per machine. Advertising is the same. So on, so forth.
It's the same bag - it's just sold at $5 hourly increments, instead of 25-cent game continues.
As for the software expense, it's just absolutely fucking cheap. $10-20k every few months for 300 brand-new huge-screened arcade games to draw in customers with? Sign me up.
The sheep that are Ebay will be more than happy to consume the year-old Alienware boxes for way more than they're worth, making upgrades and fresh hardware relatively inexpensive.
It's hard work, for sure. It's risky and probably slim-margin - arcades seem to be a very failure-prone industry. Nobody said it was easy to run a successful gaming business.
But it's not impossible. This has all been done before.
Kid-proof tablet..