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Where Are We Going?

Posted On: 10/19/2012

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TAGS: video games, amusement operator, jukebox, videogame arcade, video game trend, small business, vending, vending machine, coin machine, coin-op news, vending operating, Marcus Webb, Vending Times editorial, Tokyo Game Show, David Rockola, Nolan Bushnell

The videogame industry is on the verge of an historic shift that could eventually create a renaissance for amusement operators, much as the digital jukebox did for music. Three megatrends will drive this historic shift.

First, the rise of social networks.

Second, the explosion of mobile networks for smartphones and tablet computers.

Third, the rise of what is known as "competitive gaming."

What has all this got to do with amusement operators? Plenty, as we'll explain.

One very important sign of the times is a smartphone app called Angry Birds. Since December 2009, iPhone users have downloaded more than 12 million paid copies of the game, plus millions more free versions with limited gameplay.

At the recent Tokyo Game Show, the big story was the mobile future of consumer games. Even old-school videogame companies like Sega admitted they are scrambling to accommodate themselves to this tectonic shift.

Another important sign: Competitive gaming, already a huge trend overseas, is now catching on big time in America. Rock concert type crowds (50,000 people) jam a public venue to compete on giant screens, playing console or PC games, with successive rounds leading up to $2 million prizes.

As this trend grows, millions will tune in just to watch. That means advertising sales are possible, too.

How will these shifts impact the amusement industry? Questions like these were recently discussed at the DNA (Digital Out-of-Home Interactive Entertainment) Conference in Los Angeles ... and they need to be on the front burner for the industry as a whole. This is our chance to get back on the videogame train.

Want specifics? Imagine that you are a game player. You download a new videogame app for free onto your smartphone or tablet computer, like Angry Birds.

The game app tells you which local bars and arcades are acting as hosts for state, regional or national tournaments where prizes can reach $5 million ... and where gameplay is displayed on giant screens.

You drive to the location. You click an onscreen button to pay a $10 entry fee. The fee is charged to your mobile account and shows up on next month's mobile services bill.

You play the game with your friends who are physically present, using your phone or tablet as your controller. You stay for hours, ordering lots of food and drinks.

While there, you and your pals use your mobile apps to select and pay for some digital jukebox music. Simultaneously with the big-screen videogame tournament, you and your friends also play another national tournament on a digitally networked dart game or pool table ... also for a $5 million prize purse.

Thanks to mobile networks, your friends who are not in the location are also competing from wherever they happen to be.

Thanks to social networks, the tournament has enjoyed a huge buzz for days before the event. While the event is happening live, many of the 1 million players and 2 million viewers send out tweets -- bragging and trash-talking and commenting on the action.

After the event, results are posted to the game's Facebook page and individual players post their scores, favorite screenshots and photos of themselves having a good time in the location.

The tournament generates $2 million in revenues ... and the local operator gets a piece of it. The operator and location also profit from considerable incremental food and drink sales, plus extra play of the jukebox and other games onsite.

Now imagine that such events become a weekly occurrence in your best locations. Imagine your phone ringing off the hook, as the owners of the best locations in your territory call you up, begging to be included in your mobile digital tournament network.

That's just one possibility. There are many more ways that amusement operators can participate in mobile videogame networks. Doubtless these possibilities will be vastly more creative, more fun and more lucrative for everyone -- including operators -- than the example outlined here.

But the point is, we now have a direction. About time, too. For many years now, concerned members of the amusement industry have been wringing their hands, asking, "Where is this industry going?"

The answer is now clear. Like everyone else, we're going mobile and we're going big.  Big crowds mean big dollars. Where consumers go, money follows.

The possibilities are infinite. What we need are some innovators and entrepreneurs, the next generation of the likes of David Rockola and Nolan Bushnell, who will figure out how to take advantage of them.