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Issue Date: Vol. 49, No.6, June 2009, Posted On: 6/27/2009


Technology Won’t Define The Industry’s Future … We Will


by Kevin Williams
Kevin Williams, The Stinger Report, videogames, arcade games, arcades, coin-op games, coin-operated, amusements, amusements industry, interactive entertainment, public space entertainment, vending machine, vending business, vending routes, out-of-home, away-from-home entertainment

Here’s a radical idea. New technology is important, but it will not control the fate of the amusement trade. Instead, technology will simply offer all manufacturers, distributors and operators a chance to shape their own destinies ... for good or ill. This article looks at today’s most important technologies for videogames -- and to a lesser extent, for jukeboxes, pool and vending -- as well as tomorrow’s likeliest candidates for techno-dominance. But make no mistake, the reason for studying these trends and making these forecasts is because technology is the means, not the end … the opportunity, not the controlling factor ... in the future evolution of music and games.

Simply put, new technology is telling us loud and clear that the industry needs to broaden its horizons and open its mind to new possibilities and new ways of doing business -- even new ways of defining the fundamental nature of the industry itself. So let’s look at the top three current amusement technologies, and think about likely future technologies, to understand the decisions we can and must make to ensure a healthy 21st century industry.

Currently, the three leading trends in video are physicality, connectivity and flatscreen displays. These technologies also affect vending, table games and music in certain instances.

PHYSICALITY

It’s not too strong a claim to say that without the musical thrills of Konami’s Dance Dance Revolution and Andamiro’s Pump It Up platforms in the mid-1990s, the amusement scene would have crumbled in the face of the console game revolution.

The concept of using the player’s body as a gaming interface did not begin with those machines, of course. Earlier seen with games such as Namco’s Final Furlong and Alpine Racer, so-called “body-joystick” games caused a major stir in the market from the moment they arrived.

Unfortunately, the killer success in this area occurred in home gaming. Nintendo’s Wii console offers products that take the body-joystick concept to the next level. They feature actual motion tracking of players’ movements. This interface has enthralled the market, allowing a lifelike representation of players’ physical movement in a virtual world.

This technology, too, was first successfully implemented with arcade videogames. Outstanding examples included Konami’s MoCap, or Motion Capture, system that added excitement to such titles as Police 911 (2000) and MoCap Boxing (2001). This same motion-tracking technology most recently applied in Triotech Amusement’s UFO Stomper, placing the players yet again in the heart of this game attraction.

Tracking the hands and fingers of the players is as important as tracking the movements of their arms and legs, as dance games do. This is evident in the latest application of the physical interface: touch-table (living surface) systems. Players are able to touch a tabletop display and have a multimedia experience.

Good examples of these systems are employed by Nova Productions’ PokerKard and TAB Austria’s Fun4Four. These compelling experiences with no moving parts allow players to enjoy a level of interactivity unlike conventional systems. And players love it.

CONNECTIVITY

The Internet has redefined business and created new opportunities to entertain vastly larger and yet better targeted, more highly segmented markets. The latest generation of vending machines actually leads the way here in some respects. Remote monitoring of vending equipment is possible in the field.

With the latest technology, a routeman can drive up to a location and while he's still in the vehicle check a device that shows the status of vending machines inside. Vending professionals refer to this as telemetry. The adoption of such technology has been modestly successful by large operations overseas and in the U.S., but the majority has been slow to embrace it.

As a whole, the amusement market has lagged behind vending in applying online connectivity to other hardware. This may be less a matter of manufacturers lacking creativity, than operator reluctance to make the investment.

Japan, with its more vertically integrated market, has increasingly seen all new video amusement releases incorporating connected elements. Leading systems include Konami Digital Entertainment's e-Amusement, Taito's NESYS, and Namco and Sega's ALL.net.

What's the advantage? Why does 'Japan Inc.' believe this investment is worth billions of yen? More fun equals a fatter cashbox, and connected machines offer players a whole new level of fun. Smart cards linked into an online database offer compelling repeat play.

The U.S. has seen some of the possibilities from connected player competitions, first with Incredible Technologies' Golden Tee Golf empire and more recently with the Raw Thrills CoinUp tournament infrastructure.

American operators are less excited about connected videogames today than they seemed to be five years ago, and we no longer hear manufacturers making confident predictions that by 2012 all the really successful games will be networked.

But now that broadband connectivity has become a standard in many locations in America, it's possible to have a generation of videogames that, like jukeboxes, don't require swap-out in order to update the software. We're already seeing some of this with the most advanced touchscreen countertop games. And digital signage and advertising will help maximize machine revenue and impact, and point towards totally marketing-funded entertainment.

FLATSCREEN

Although flatscreen technology is best described as a hardware upgrade, it has revolutionized the look and feel of modern amusement products. The industry's first applications of LCDs and flat plasma display panels (PDP) occurred in 2001, when Konami introduced a conceptual universal cabinet design.

In 2003, Sega America showed a cockpit-style driving simulator with this type of display. Both Japanese products pointed toward an exciting new era of visual verisimilitude. LCDs and plasma screens are very compelling in part because they transcend the limits of CRTs: i.e., low-pixel counts and shallow depth of field.

So why haven't we seen more LCDs and plasma screens in amusement videogames? It's the old story: High prices mean slow adoption rates. It took the vision of U.S. developer Global VR to show what a flatscreen display cabinet could achieve in style and presentation. Its Nascar Racing cabinet, along with Sega's Lindbergh-based games and Namco's NOU cabinet series in Asia, set the current standard.

THE FUTURE

What new technologies will this industry be able to offer during, say, the next three years? The answer to that question depends on how the industry wants to evolve.

If we continue as 'just amusements,' we risk obsolescence, being replaced totally by consumer technology that keeps miniaturizing its products, while vastly expanding its entertainment capabilities and content offerings. Cashbox profits will simply dissolve because operators will not be able to offer something better, if as good, as what consumers can get at home -- often, more cheaply.

In order to survive, the worldwide amusements business must embrace a radical new insight: Technology alone will not save the industry from its current 12-year-long downturn. Instead, the industry must redefine itself as more than just high-tech fun with a payment system attached.

The trade must deliberately blur the hard lines and dissolve the barriers that previously separated amusement, advertising, marketing, communications, social interaction and quite possibly even online commerce.

Yes, tomorrow's successful industry will still have machines at its heart. But those machines will offer much more than simply music and games. They will generate multiple revenue streams from cross-sector capabilities. Advertisers, locations and players alike will be able to use tomorrow's machines to send their messages to each other. Think Facebook meets Pac-Man.

At least one powerful -- and very successful -- example of this futuristic application of technology is already here. The Ecast EQ is a sleek, wall-mount POS device with a 40' flat-panel touchscreen supported by broadband connectivity. As Ecast explains, EQ delivers on-demand content including video, real-time interactive surveys and games, advertising, social applications and a jukebox interface for music. The top section of the monitor can display fun photos and text messages, sent from patrons' cellphones, for everyone in the venue to view.

Where does the traditional jukebox market end and new public-space entertainment begin? With a system like EQ, there is no line between them ... and that's a good thing. This same principle must shape the future of video amusement as well.

Next, payment systems must change. The amusement sector has lived off the same basic coin mechanism, 'with little change,' since the 1920s. Meanwhile, consumers and financial institutions are steadily moving toward a cashless, electronic economy. (Did you know more U.S. consumers now get monthly bank statements online than receive hard copies in the mail?)

For videogames and jukeboxes, e-payment creates opportunities to monetize pay-for-play in a whole new way. Yet this is one more case where updating the technology is only half the battle; the industry's mindset about payment must also be transformed. Will tomorrow's amusement trade let players use mobile phones and swipe cards to pay for credits? Of course it will.

But just as importantly, tomorrow's industry will make creative use of sophisticated pricing, marketing and promotions, such as loyalty programs, cash rewards and special benefits, in a way where (once again) the lines are totally erased between what used to be 'payment' and what used to be 'marketing.' Payment and marketing will be one inseparable entity. They will also be constantly fluid as economic conditions change ... certainly from week to week, and in some cases literally from hour to hour.

All this will fundamentally change the way the amusement industry generates money. Whether it's videogames or music, whether it's marketing or payment, success for the industry of tomorrow will not be a matter of passively waiting for some great new technology to rescue the manufacturer, the distributor and the operator.

What will be the most exciting new technology in three or five years? It's anyone's guess. But the more important question is: What kind of industry will exist to profit from that technology? The answer is up to us, and it's something we can begin to decide right now.


KEVIN WILLIAMS is founder and director of the out-of-home leisure entertainment consultancy KWP Ltd. His extensive experience in global video amusements and high-tech attractions includes top management and design posts with a focus on new technology development and applications. He is a well-known speaker on the industry lecture circuit and has authored numerous articles. Williams is also editor and publisher of The Stinger Report, a leading industry e-newsletter and Web-based information service. Go to thestingerreport.com to sign up for a free subscription.


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