Topic seems fine here.

This topic almost seems more directed to Bill, as he's probably the only one with concrete stats on how the machines are doing, and why they aren't here anymore.

Before my trip to Power Play, the last time I played in an arcade was a few months ago. And then a few months before that... so I'm not contributing much to the arcade presence; just the online front.

I'd like to see if Bill would be willing to show what some of the games' average profits each month were. The problem is when a machine is not in a garage it has to make enough to pay for the space it occupies every month or it gets replaced.... I'd imagine it boils down to largest profit per square foot  in deciding which games come or go but I'd like to hear Bill's opinions on the matter in order for me to get the big picture in his cases. I do know for a fact that a small community of 12 people can't support a game.... I've seen that happen at Tilt. It's gotta get randoms... I think rhythm games that are played here aren't attractive enough or are too embarrassing or simply don't have enough name recognition / word of mouth recommendations to succeed.

Ioris hit the nail on the head.  A small group of supporters just does not add up to viability.  PIU Pro, 2DX and others that were removed were down to the 15.00-25.00 per week gross income range.  Not enough to even support repairs when they break down.  And remember, a share of that gross income gets paid to the location, so do the math, and it all makes sense.  Wish the nich community was larger so we could support more cool things.  I love it when that special game excites people, as well as earns it's keep.
The arcade market has turned much more casual in recent years as you all can see.  this ups the demand for games that are simple to understand, but not the best gaming experience.  Pretty sad, really.  But have to stay with the times.
The nich market that is still succeeding seems to be the Japanese import driving games, such as Maximum Tune.  Hundreds of followers for that that still play daily.

I don't see what the point would be in even running an arcade if this is what the demand is.

It seems games now-a-days everywhere are designed with a more aesthetic purpose than a practical purpose. It's neither good to have one over the other when designing anything really.......sorry for that little tangent there

I can't imagine its economical to put 3 or 4 dance games at the same location anyway. I would think the randoms would get split somewhat evenly throughout the almost identical games (to those who don't play regularly).
There is a DDR Extreme machine on UW campus just across 520 from where you live if you recall. 5-10min drive 5-10min walk from where you'd park, not that Acme is that far either.

 Along those same lines, I'm sure UW's DDR machine makes a lot, as I've played there and there's always people. Bill, you should put one of those spare DDR Extreme or Max2 machines at Green River Community College in their 'arcade'. I could put in the good word for your actually maintaining your machines and you'd make bank Really I just want to play DDR at work, but you can be sure I'll get people to play that damn thing, and you probably have 2 or 3 thousand high school/college kids going through that building every day so lots of room for profit.

  Just a thought

While I'm no expert, this discussion is pretty much on-target with the information I've been able to gather in my pursuit to open my own arcade. Everywhere I look and everything I learn is just further driving home the reality that, with a few exceptions, arcades are not a profitable business.

I'm personally pissed at the machine manufacturers. The price of these machines is absolutely ludicrous when you realize it will likely take years at a high-traffic location to pay off the initial cost of the machine. The cost of the "new" Afterburner Climax Delux cabinet is over $25,000! If I recall, Capcom was wanting $10,000 just for the PCB board for  Street Fighter IV. A new cabinet was $25,000! When a video game costs more than a new full-sized SUV, you know something ain't right.

In addition to the initial cost of games, the machine usually has a lot of overhead costs associated with it; staff wages to run facility, electricity, insurance, rent, floor space, etc. When you add up all these costs it just becomes incredibly expensive and infeasible for an arcade to be financially independent. It needs something else to live on, like a bowling ally, movie theater, or college environment that provides dozens or hundreds of random visitors an hour to drop some cash into the machines at a regular basis.

This need for the random patrons is often what results in poorly maintained machines and an shoddy operation. I'm honestly amazed and incredibly thankful that Bill has kept up such great communication with the local bemani players. We are not his "bread and butter", but I appreciate the fact that he keeps his machines in top shape for those of use who can appreciate it.

Don't forget that music games have a much worse player turnaround time than other arcade games.  Even a beginner is more or less promised 2 songs if autofail is off in DDR.  And PIU was always especially bad since it was so easy to achieve the extra stage (unless this has changed in recent versions).

BEMANI/VIDEO GAME COFFEE SHOP!     The coffee would make the money, the games would just be there...

I don't think you're actually that far off the bat. Places like laundromats, coffee shops, theaters, pizza joints and the like often have arcade games where there is otherwise unused space.I think if you had an anchor service and arcade games as a logical (see: Roccos w/ pinball, theaters with games, Chuck E. Cheese w/ games) (don't see: don't have DDR in the lobby of an upscale diner) extension of your service that would fit (serve) the niche market of your primary service you could make it work. I don't think the focus could be games unless you have a very good target marketing strategy like GK. With the advent of systems that provide an arcade perfect experience with theoretically unlimited comp there's no reason for many gamers to travel to an arcade to end up paying more than they would if they played at home.

Back when I was still in college, a friend asked me if I had any ideas on how to make a profitable arcade in the US these days.  I didn't have an answer then, but since then I had the idea of a hybrid coffee/tea/sandwich shop with an arcade billed as a place to socialize.

The idea also included a few console gaming suites that could be rented out for a certain period of time, channeling Japanese Karaoke Boxes but with a better home theater setup.

Throw in that music games, at their height in arcades, also saw 2 new releases per series per year from Konami, and each was still priced pretty highly, plus music games go through propriety controller parts pretty quickly.  The two releases per year thing is an astonishing development cycle compared to other arcade games; that was during the time when Naoki had a handful of songs per game for most games, I once saw the math and he was churning out more than one song per week consistently for about 2 years (say what you will about quality or diversity of his music) in addition to helping write and/or produce for a few in-house acts.

I will say the "flashy and expensive" vs. "small, simple, and cheap" debate is a tough one.  Obviously, Bill will have actual data, but looking at it in theory: simple games are easily reproduced at home with standard controllers or easily produced, cheap peripherals, so there's little reason for the average person to drop more than a couple dollars in the arcade before knowing if they'll play it enough to buy it and never play in the arcade again, whereas big, flashy games with unique peripherals are impractical at home (see: steel battalion's 200+ dollar controller that only worked for a single game, since no sequel came out due to financial concerns), but the machine will cost so much that the payoff is slow, and that's only if players will put up with the startup cost, since new controls take time to learn.

Oh man this reminds me of TGA (Tokyo Game Action).  It was a fantastic arcade that started in Rhode Island and was all Japanese import games.  Multiple DDRs (5th, Extreme, and Supernova 2), ITG 2, IIDX, beatmania, 2 Pop'n, 2 drummania, a guitar freak, Taiko, some weird Japanese guitar game, PPP, and a whole separate room for ranbats, filled with import cabinets.

The community was big in supporting it, and the Japanese style kitchen they ran inside the place.  But nothing could save it from 2 floods and many electrical problems.  The owner, Andy, sadly went bankrupt, which sucked because he was amazingly passionate about the arcade and practically lived there.

The last place they were was half bowling alley, half arcade.  But before that, it was a pure arcade, and before that, it was in a coffee shop!  But the coffee shop was frequented by old ladies who seemed to be refining their best glares for dance games and those who played them. lol

The scene is truly dead over there after the collapse of TGA, and the removal of the machine at MIT.  I feel like these arcades hold together the community, and it's really important that we try to keep them up and running with our support.

Sorry that was a little tangential, but I really really miss TGA and how amazing it was.  I think Laura makes a good point in that we should all accurate represent how often we truly are going to play.

Thanks for all your hard work, Bill!

I think that a lot of the suffering that the arcade is experiencing is that fact that the current job market operates against a lot of gamers.  I simply don't have time during the day for most jobs, so I'm stuck with enough money to pay for my cost of living, leaving me with very little to spend on games.  Also, the multiplayer experience used to only be feasible at arcades.  Before 6th gen consoles, the only online multiplayer was crappy, expensive PC games.  Now, almost every 360, PS3, or Wii game features online play, and nearly every home in the country has land-line internet available to provide a quality gaming experience.  A huge factor that made arcades prominent in the 80's and 90's is now obsolete.

As a result, arcade game producers have to find ways to give these games and edge.  They do this by releasing the games long before their Console counterparts (Tekken 6), making extravagant cabinets with high-grade controllers (ITG2), or providing gameplay options that simply can't be achieved with a home setup (DanceManiaX).  However, all of these methods cause the production value to skyrocket, and the publishers aren't about to take the hit for that.  Likewise, gamers aren't going to increase their demand to meet the cost of supply, and this cripples the arcade industry, so every party involved experiences losses.

The other problem here is that new games become old games too quickly, and arcade cabinets aren't as collectible as games are because they don't have as vast of a consumer market.  Thus, keeping games up-to-date is nearly impossible, but if they're not up-to-date, then they don't make money.  There simply isn't enough money flow in the industry to keep it afloat; it's not flexible enough to adapt to the competition of online gaming.  Arcades are going to continue to go out of business until the supply meets the demand or until some brilliant innovation comes about to make it sustainable.  I predict that arcades will be a huge luxury within ten years, and that only major cities will be able to support them (except redemption arcades like Wunderland Electronic Castles), but I don't really count those under the same umbrella for the sake of this discussion)

Tofu, how do you not have time for a job?  What about night jobs?

This could be why...


http://www.businessinsider.com/john-carney-the-ugly-job-loss-chart-keeps-getting-uglier-2009-10

Less jobs means less options for when you can work.

Actually, that doesn't quite answer the question.

He said he didn't have time for a job in the day; not that there weren't jobs available for him. I was curious to what he was doing that wouldn't allow for any job. (school maybe?)

School, the commute implied by it (2 hours 20 minutes each way), volunteering with way too many cons, and being in two bands, neither of which is really making money.  I still wind up with a lot of free time, but it's really inconsistently spaced throughout each week, so getting a part time job that wouldn't totally blow AND would be able to work around my school/band/con schedules would be very difficult, to say the least.

Fortunately, besides taking up a huge amount of my time and attention, school also provides the funding that makes it possible for me to survive without a job for the time being, and will hopefully generate the credentials necessary for me to get one in the future.

Ah, sounds like you are indeed a busy guy.  Too bad the bands aren't making anything. What do you play again?

(back on topic)
I wonder how much the revenue for types of machines varies from say a place like Gameworks, to an arcade in a bowling alley (Acme, Narrows), and from regions (Oregon vs Washington)...

The revenue for card based arcade would be really hard to calculate.  Yes, you can obviously get machine by machine stats (Power Play kiosks tell you the last few games you've played; they could do quite a deep level of analysis if they chose to log every single swipe), but a this is complicated by a devoted player (for instance, any Bemani player) taking a high value card for the discount (since they'll use free credits), the fact that they try to upsell to casual customers in the hope they won't use everything they've payed for (or will stick around to not waste the extra money they loaded on the card, thereby making the arcade look more popular and attracting more paying customers), and the existence of timed freeplay cards (at Gameworks/IZ, at least).  Plus the revenue model is mode-based - it's built around running a normal arcade (but with food service) during the day and getting people to drink, eat, and then show off a bit to their friends while drunk in the evening; you'd really wind up needing the level of precision PP is capable of to say what's making money as that will likely depend on what "mode" the place is running in at different times of day.  I know Bill gets some runoff from the bars at bowling alleys, but I usually only see drunk people play one or two games before leaving, while GW and PP are built around keeping you drunk while you keep shoveling credits into machines.

If you're going to either of those places to gent drunk you obviously have too much money. Then again, this is downtown Seattle and Downtown Bellevue we're talking about, so I guess I shouldn't be surprised.

I haven't found those places to be much more expensive than any other club/bar type setting.  Washington State has a ridiculously high liquor tax.

I don't want to start an argument over this, but I'd like to go off topic for a second and say that one point I'd really like to make is that "too much money" is very relative. If somebody makes 200k a year,  everyone thinks they must be loaded, but if they're making that in an area where all the rents are 2-3k a month and entertainment is a premium as well, they're actually likely to not have very much left over at all.  When I was a kid I asked my mom if we were rich because a friend had said we were, and my mom said that being rich meant having enough savings to live off the interest.  The very DEFINITION of wealth is subjective.

Anyway, back on topic. I'd think that you could figure how much each machine was making with only SOME difficulty by doing a kind of "averages" thing on how much money people add to their cards to find out the average value of the points on all the cards that go out, and using that to estimate how much was pumped into each machine.  So like, if 50 people buy a 20 dollar card, and 20 people buy a 50 dollar card, what's the average number of points per dollar factoring bonus points they get as a promotion? Then you use that value to figure out what each machine is bringing in.

This gets you close - probably close enough to make well-informed purchasing decisions - but it misses the unused points for lost cards, people who never come back, etc.  I don't know how sizable that figure winds up being, so it may be a moot point in the end, but if it is appreciable, it's basically money they get for having any games as opposed to ones that bring in more than the cost of maintenance.  Then again, I would be surprised if their business model includes being content with machines that simply break even on repairs, since they just want you in the arcade so they can try to sell you food and drink - a machine which profits on its own merits could just be a bonus for them.

BigAl's has a good solution to misplaced cards... They provide a marginal but enticing discount for using the same card. I believe it's once you spend $500 (on food, drinks, games or anything) on your BigAl's card that you get the BigAl's VIP card that provides the discount. No one wants to lose a card that possibly saves them money in the future.